Recession Watch Indicator for week ended August 31, 2012

Here's my own personal cut at a recession watch indicator, for week ended August 31, 2012:

• ECRI Weekly Leading Index Growth Rate: just turned slightly positive (+0.3) – pale GREEN flag (+1)
• Weekly Employment Insurance Initial Claims moving average: elevated but below 400K (370K) – pale green flag (+1)
• Recent M2 Money Stock: rising – pale green flag (+1)
• Macroeconomic Advisers GDP outlook for Q3: modest growth (raised to +2.2%) – pale green flag (+1)
• Recent Employment Growth: modest (163K) – pale green flag (+1)
• Recent ISM Manufacturing Reports: slightly negative (49.8) – pale yellow flag (-1)
• Recent ISM Services Reports: modestly positive (52.6) – pale green flag (+1)
• Average: +0.71 – pale green – recession not likely but still possible

No real change in the overall outlook since last week.

 

-- Jack Krupansky