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Discussion: (6 comments)

  1. morganovich

    when 50 or so of the 100 indicators in an index are rate spreads which are being deliberately and massively manipulated by the fed, i’m not sure how seriously we can take such an index as an indicator of anyhting.

    in an age of ZIRP, twist, QEinfinity etc, rate spreads are not representative of what they once were.

    1. Lots of other indexes are in or close to suck-level ville too, the Fed’s anxious index being one and the Michigan sentiment index being another.

      The CFNAI has been negative for 8 months in a row.

      1. Jon Murphy

        The CFNAI has been negative for 8 months in a row.

        9 months now (new release came out this morning). But negative doesn’t mean negative growth. It just means slower-than-historical average. That doesn’t surprise anybody.

        But I agree with Morganovich. I never use the financial markets as an economic indicator anyway, but when you add in the Fed’s actions, it makes it a little less viable.

        But what this does tell us is that there is capital available for those who want to borrow.

        1. Lower CFNAI is a pre-condition to recession. And the sentiment index and dozens of other indexes show the story on how many want to borrow, and the growing chances of recession.
          No comment on the [censoreds] in Foggy Bottom who love to play the blame game while Rome burns.

          You can lead a horse to brackish and dangerous waters but you can’t force him to drink, borrowing wise.

          1. Jon Murphy

            Oh, I am not saying we are not headed towards a recession (I am record multiple times here and elsewhere calling for a recession in late 2013/early 2014). I’m just saying we’re not in a recession yet.

  2. I’m not as sanguine, given extant trends and so many elements at and below recession levels, plus the many high potentials for revisions of existing and apparently okay indexes.

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