Investment

» Zmrkt - Re:Achuthan of ECRI Doesn't Sees Recession from Subprime Fallou

In response to Re:Achuthan of ECRI Doesn't Sees Recession from Subprime Fallou posted by Jas_Jain:

Perhaps by the time the ECRI king predicts the whopper the markets are already looking ahead that far. My guess, and this is a guess, is that ECRI is focused on the lack of inflation as an indicator that the fed has room to lower the fed funds rate. The only problem is inflation is a misnomer today as it no longer reflects true inflation. Not to mention the core vs non-core, (not certain how many consumers don't use food and energy). Alas, we shall await the proclaimation of the downturn, but my guess is that they are suspecting, as is the market, that the fed will push this whopper off until the avg consumer can Jas afford to eat at BK.

-- posted by Zmrkt

» permabear - Re:Achuthan of ECRI Doesn't Sees Recession from Subprime Fallou

In response to Re:Achuthan of ECRI Doesn't Sees Recession from Subprime Fallou posted by Jas_Jain:

No recession for at least 6-8 months AFTER economists at ECRI forecast the next recession.

How could a recession happen unless it shows up in the leading indicators?

Jas,

When I read your post I took a double take on whether you were serious or specious. Assuming you were serious, I remain skeptical about whether ECRI can really see the downside of this economy. Thus far I have viewed ECRI's economic forecasts as representing the conventional Larry Kudlow Goldilocks Wall Street view of the economy and stock market. That is the housing problems are short-lived. Credit problems aren't that serious and won't affect the mainstreet economy. Until I see some recognition of the seriousness of the problems facing the economy going forward, I will remain skeptical.

-- posted by permabear

» ECRI - WLI Drops

NEW YORK, Aug 24 (Reuters) - A gauge of future U.S. economic growth fell last week, weighed by higher interest rates and falling equities prices, and its annualized growth rate slowed to a 37-week low, a research group said on Friday.

The Economic Cycle Research Institute, an independent forecasting group, said its Weekly Leading Index (WLI) slipped to 139.8 in the week ended Aug. 17 from 141.7, downwardly revised from an earlier-reported 141.8.

The annualized weekly growth rate in the index slowed to 2.6 percent from 4.1 percent in the prior week, revised from 4.2 percent.

"This week's sharp drop in WLI growth indicates a dimmer economic growth outlook, but not a recessionary tailspin," said Lakshman Achuthan, managing director of ECRI.

The fall in the index was partially offset by a lower joblessness rate, Achuthan said.

p.s. look for me on CNBC at 1:05 PM (ET)

-- posted by ECRI

» Jas_Jain - Re:Achuthan of ECRI Doesn't Sees Recession from Subprime Fallou

In response to Re:Achuthan of ECRI Doesn't Sees Recession from Subprime Fallou posted by permabear:

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"Thus far I have viewed ECRI's economic forecasts as representing the conventional Larry Kudlow Goldilocks Wall Street view of the economy and stock market."

That is the American Way! Who wants to be unpopular in a democracy where popularity is the prized virtue?

High stock prices are good for everyone and high home prices are even better for all. Fed wants to put a floor on the combined value of stocks and homes because if it can't then it is all down hill.

I think that WLI is indirectly a measure of liquidity in the system. The key level to watch is 138.3, a level first reached in Jan'06. No move in the index in 20 months and that means the recession is almost there.

Jas

-- posted by Jas_Jain

» Jas_Jain - re: WLI Drops

In response to re: WLI Drops posted by Kirk:

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Thanks, Captain.

Looks like the WLI growth rate is falling of the cliff, no?

Jas

-- posted by Jas_Jain

» Jas_Jain - re: WLI Drops

In response to re: WLI Drops posted by Kirk:

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"The other guy seems really upset... he quiped that Lakshman was predicting a recession for January 2008... maybe he is Jas Jain in a mask? "

You are pretty good at unmasking, Kirk.

Lak said that the economy has no vulnerability right now, which is necessary to cause a recession. I guess, the rising default rates and falling home sales & prices don't cause enough vulnerability.

At least we know that there would be no recession this year.

Jas

-- posted by Jas_Jain

» DrToast - Interview

If you missed it, you can see it here:
http://www.cnbc.com/id/15840232?video=48...

-- posted by DrToast

» ECRI - Interview

In response to Interview posted by DrToast:

Thanks for getting the link up. FYI - Anirvan mentioned that there is now a bit of a debate on the columnist blog on realmoney.com that keys off of this CNBC interview.

-- posted by ECRI

» Zmrkt - Recession?

It seems many are questioning the possibility of a recession on the horizon. But perhaps one needs to consider whether we stand at a greater precipice. The slump in the housing market has been deemed in a recession but many comparisons can be drawn to the period of the depression with home prices falling at alarming rates. Moreover, one may also want to consider why Bernanke is at the helm, a specialist and scholar on the great depression. There are many bubbles out there and they always seem to end in the same manner. I have heard that ECRI has a very good track record of predicting recessions, but we may not be looking for a bump in the road, this may be Jas a tad steeper. Good luck with your investing and be careful...

-- posted by Zmrkt

» Jas_Jain - Re: Recession?

In response to Recession? posted by Zmrkt:

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"Moreover, one may also want to consider why Bernanke is at the helm, a specialist and scholar on the great depression."

That is a very important point, Zmrkt. Bernanke was put in because conditions existed that would lead to something like the Great Depression, e.g., debt and "bankers' mischief." But we all know the generals fighting the last war.

"There are many bubbles out there and they always seem to end in the same manner."

"I have heard that ECRI has a very good track record of predicting recessions,"

I would like someone to post a detailed past record based on forecasting recession before they happened and not by back testing the data.

".but we may not be looking for a bump in the road, this may be Jas a tad steeper."

Steeper than the Greater Depression?

"Good luck with your investing and be careful..."

Being careful doesn't exist in the vocabulary of bulls. All dips are buying a opportunity except for the last before the depression.

Jas

-- posted by Jas_Jain