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The time .... has arrived.

Discussions about the economic and financial ramifications of PEAK OIL

Re: The time .... has arrived.

Unread postby Outcast_Searcher » Sun 10 Nov 2019, 22:46:20

copious.abundance wrote:
Outcast_Searcher wrote:Re the US treasury yield curve going positive in mid October, moving more strongly positive in November, and US treasury interest rates rising meaningfully, that would seem to put a big dent in the "US recession is certain and soon" argument...

If you look at charts of the yield curve compared to recession starts, you notice that it is sometime after the yield curve goes positive again that the recession begins.
https://fred.stlouisfed.org/series/T10Y3M
^
Be sure to expand the slider beneath the graph to go all the way to the left to see the entire history.

Recessions are shaded in gray. Notice that when the recession starts, the yield curve has already gone back positive for at least a few months, and often as much as a year.

Thus, if history repeats itself, we would probably not see a recession start until sometime next year.

If we do not get a recession until maybe sometime early in 2021 at the latest, I'll concede my thesis in this thread did not pan out.

Fair enough. Thanks for the explanation.

Like I said, unlike certain types on this site, you don't post frequent unsupported nonsense, and over time have a good track record, re your economic calls, IMO.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The time .... has arrived.

Unread postby EdwinSm » Tue 03 Dec 2019, 02:44:08

Time for the November update (dated 21st November 2019).

THE TIME IS AT HAND (ie it seems very close now)

The Conference Board Leading Economic Index® (LEI)for the U.S. declined 0.1 percent in October to 111.7 (2016 = 100), following a 0.2 percent decline in both September and August.

“The US LEI declined for a third consecutive month, and its six-month growth rate turned negative for the first time since May 2016. The decline was driven by weaknesses in new orders for manufacturing, average weekly hours, and unemployment insurance claims,”


Balancing the decline in the Leading Index, the Lagging Index had a small increase.

Neither seem to show dramatic changes, but it is not looking good going forward - only this is happening in slooooow motion.

https://www.conference-board.org/pdf_free/press/US%20LEI%20PRESS%20RELEASE%20-%20NOVEMBER%202019.pdf
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Re: The time .... has arrived.

Unread postby marmico » Tue 03 Dec 2019, 05:53:14

Neither seem to show dramatic changes, but it is not looking good going forward - only this is happening in slooooow motion.


Ring the recession bell (The time....has arrived) when the LEI is lower than the CEI. The LEI 6 month growth rate has touched zero for the 4th time since the current economic expansion began 10+ years ago.
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Re: The time .... has arrived.

Unread postby Cog » Tue 03 Dec 2019, 08:27:08

Facts come in and harsh the doomer buzz.
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Re: The time .... has arrived.

Unread postby copious.abundance » Tue 03 Dec 2019, 20:42:47

marmico wrote:
Neither seem to show dramatic changes, but it is not looking good going forward - only this is happening in slooooow motion.


Ring the recession bell (The time....has arrived) when the LEI is lower than the CEI. The LEI 6 month growth rate has touched zero for the 4th time since the current economic expansion began 10+ years ago.

It does look like that would be the threshold on the chart, but I'm wondering if their crossing each other might just be a coincidence? When they've crossed over on the chart, that also happens to be when the CEI starts to turn lower (which is when the recession arrives). But if the CEI happened to start heading lower even if the LEI was still higher, seems to me that would still indicate a recession had probably begun.

After all, the purpose of the LEI is to anticipate future conditions, and the CEI is supposed to indicate current conditions. So once the CEI starts going lower, that would indicate the recession regardless of whether the LEI has crossed over it or not.

But I guess time will tell.
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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Re: The time .... has arrived.

Unread postby copious.abundance » Thu 23 Jan 2020, 19:44:29

US Leading Economic Indicators Plunge At Worst Rate Since 2009
A worse-than-expected 0.3% MoM drop in the Conference Board leading economic index, ending the year with 5 down months in the last six.

The biggest positive contributor to the leading index was stock prices at 0.09

The biggest negative contributor was jobless claims at -0.23

The LEI is clearly not recovering...

Image
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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Re: The time .... has arrived.

Unread postby marmico » Thu 23 Jan 2020, 20:40:47

The biggest negative contributor was jobless claims at -0.23


Initial jobless claims will be a positive contributor in the next CB LEI report.

Image

The first print of Q42019 GDP is next week. It seems certain that there will be 5 consecutive positive quarterly prints since your initial post.
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Re: The time .... has arrived.

Unread postby copious.abundance » Fri 07 Feb 2020, 20:27:56

Jobs report came out today. It included the annual benchmark revisions for the year ending March of last year. To reiterate that things were starting to weaken when I started this thread, that time period was revised down by a hefty 514,000.

January adds a much stronger-than-expected 225,000 jobs, with a boost from warm weather
There was one piece of bad news as well pertaining to benchmark revisions the department incorporates into its historical count. This year showed a decline in the total nonfarm employment for the year ending March 2019 of 514,000, a bit higher than the 500,000 that economists had expected and were indicated back in August.


BLS tables for payroll jobs are here:
https://data.bls.gov/timeseries/CES0000000001?output_view=net_1mth

Load the data into a spreadsheet and you can calculate the following year-end totals:

2010: 1,034,000
2011: 2,074,000
2012: 2,176,000
2013: 2,301,000
2014: 3,004,000
2015: 2,720,000
2016: 2,345,000
2017: 2,109,000
2018: 2,314,000
2019: 2,096,000

2019 was the weakest since 2011.
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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Re: The time .... has arrived.

Unread postby Armageddon » Fri 07 Feb 2020, 20:50:18

You haven’t seen anything yet. Just wait till this Corona virus destroys the global supply chain. Factories all over China are already shut down
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Re: The time .... has arrived.

Unread postby copious.abundance » Fri 07 Feb 2020, 20:52:32

Of course, this also means there's a 30% chance a recession won't happen in the next 6 months. :wink:

There’s a 70% chance of recession in the next six months, new study from MIT and State Street finds
There’s a 70% chance that a recession will hit in the next six months, according to new research from the MIT Sloan School of Management and State Street Associates.

The researchers created an index comprised of four factors and then used the Mahalanobis distance — a measure initially used to analyze human skulls — to determine how current market conditions compare to prior recessions.

[...]

Using this principle, the researchers analyzed four market factors — industrial production, nonfarm payrolls, stock market return and the slope of the yield curve — on a monthly basis. They then measured how the current relationship between the four metrics compares to historical readings.

Looking at data back to 1916, the researchers said that the index was a reliable recession indicator since it rose leading up to every prior recession. They found that when the index topped 70%, the likelihood of a recession in the next six months rose to 70%.

As of November 2019, the reading on the index was 76%.
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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Re: The time .... has arrived.

Unread postby Armageddon » Fri 07 Feb 2020, 21:36:39

Janet Yellen: We didn't see the 2008 financial crisis coming
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Re: The time .... has arrived.

Unread postby marmico » Sat 08 Feb 2020, 06:28:19

The payroll growth rate will continue to decline. It's demography. The US economy has faced declining payroll growth since 2000 and low productivity growth since 2005. The economy is aggregate hours (demography) times output per hour (productivity).

Image

Image

The decline in payrolls of ~30 basis points due to benchmark revisions was somewhat offset by a ~10 basis point increase in aggregate hours.
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Re: The time .... has arrived.

Unread postby Outcast_Searcher » Sun 09 Feb 2020, 04:47:04

copious.abundance wrote:US Leading Economic Indicators Plunge At Worst Rate Since 2009
A worse-than-expected 0.3% MoM drop in the Conference Board leading economic index, ending the year with 5 down months in the last six.

The biggest positive contributor to the leading index was stock prices at 0.09

The biggest negative contributor was jobless claims at -0.23

The LEI is clearly not recovering...

Image

Um. WHY pray tell are all the flat to downish spots on the chart like '95, '98, '02, etc. circled and discussed? Oh yes, because the pattern DOESN'T CONSISTENTLY WORK.

Just like technical analysis re reading stock market charts generally doesn't work (after accounting for extra active trading expenses) well enough to provide ANY useful actionable information.

...

Not that I'm surprised to see zerobrains braying about economic doom at every opportunity, whether it's likely to be VALID or not. :roll:
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The time .... has arrived.

Unread postby copious.abundance » Tue 11 Feb 2020, 20:02:41

Yes, there are a few spots on that chart where a sideways pattern for a little while didn't turn into a decline but were more like in a consolidation phase. So we'll have to wait and see.

One other economic release out today was the JOLTS report. And job openings are pretty much in freefall. (source)
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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Re: The time .... has arrived.

Unread postby Outcast_Searcher » Wed 12 Feb 2020, 18:05:53

copious.abundance wrote:Of course, this also means there's a 30% chance a recession won't happen in the next 6 months. :wink:

There’s a 70% chance of recession in the next six months, new study from MIT and State Street finds

[/quote]
Or, as a rational or honest person would admit, there's also a good chance your cherry picked OPINION (AKA this study, since it reflects negativity on the economy) is wrong. But I know: the perma-doom patrol doesn't want to admit that.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The time .... has arrived.

Unread postby Outcast_Searcher » Wed 12 Feb 2020, 18:14:02

Armageddon wrote:You haven’t seen anything yet. Just wait till this Corona virus destroys the global supply chain. Factories all over China are already shut down

Of course in the real world, that's balanced with the fact (easily found in various MSM stories) that in China, many businesses are opening, as the Lunar holiday has ended, and the virus growth rate appears to be moderating.

So the news on this is mixed, despite your usual cherry-picking ways.

Oh, in places like the US, the Coronavirus isn't spreading rapidly, unlike doomer hopeful forecasts like the cases doubling every day, etc.

And my initial forecast/vote when the poll went up for 100 to 1000 deaths has been eclipsed, and looks to be more like the 1000 to 10,000 or perhaps even the 10,000 to 100,000 range, if it doesn't die way down as spring comes, as many expect.

But not looking like anything near the 10 million to every single person dying a third of the poll takers on this site predicted, re the current state of the poll as I write this.

...

But I know. We haven't seen "anything" yet, as you persistently bray, and some day, might actually get right for a day, or a cycle. 8)

Not that you or a stopped clock have any actionable predictive usefulness, except in your own mind as an "economics expert", based on your track record on this site.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The time .... has arrived.

Unread postby Armageddon » Wed 12 Feb 2020, 18:59:36

This Is What Happened After One Chinese Company Rushed To Reopen After The Corona-Chaos


https://www.zerohedge.com/health/what-h ... rona-chaos


Yeah, let’s get them all those factories up and running ASAP
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Re: The time .... has arrived.

Unread postby shortonoil » Thu 13 Feb 2020, 09:59:05

This Is What Happened After One Chinese Company Rushed To Reopen After The Corona-Chaos


We can't totally eliminate the possibility that this virus has its own version of "Typhoid Mary’s". People who carry the disease, and who can spread it, but never display symptoms. It has already demonstrated almost every nasty characteristic imaginable. Incubation periods of up to 24 days, it can remain viable of surfaces away from a host for 9, unknown vectors, high mortality rates, and etc. If that is the case China's factories might not ever operate again. The West needs to be concentrating on how it is going to get its factories back.
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Re: The time .... has arrived.

Unread postby Outcast_Searcher » Fri 14 Feb 2020, 03:33:57

copious.abundance wrote:Yes, there are a few spots on that chart where a sideways pattern for a little while didn't turn into a decline but were more like in a consolidation phase. So we'll have to wait and see.

One other economic release out today was the JOLTS report. And job openings are pretty much in freefall. (source)

There's little chance that the Coronavirus is going to make plenty of economic indicators look bad for awhile.

Of course, the doom patrol is having a great time predicting the end of the world (in relative terms) as would be expected.

How bad they'll actually get in the US remains to be seen. Last I checked, the US has 15 cases, and nearly all of them are people who were in quarantine for the virus, from what I've read.

Still 15 more than I'd like to see, but not exactly the doubling of new cases every day, etc. that the doom mongers were predicting either.

I think that (and fears of that) are going to play havoc with a lot of short term indicators for awhile. Not sure how "reliable" we should consider those signals, since we know so little about what will actually happen with that globally.

Oh, and if we're at "full employment", is job openings falling all that unexpected? I see they've been weak for over a year now.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: The time .... has arrived.

Unread postby copious.abundance » Wed 26 Feb 2020, 23:46:50

I am pretty sure you are the first person on this board to ever lump me in as part of a "doom patrol."
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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