A slight piece of good news this morning. The Conference Boards' Leading Indicator Index -- designed to forecast future economic activity -- rose in December for the first time in a number of months. This is somewhat of a surprise. The not-surprising news is that the Coincident Indicator Index -- which measures current activity -- declined in December. The bad news about that decline is the size. Over the past six months, the coincident index has declined at an annual rate of 4.3%.
On Friday, the BEA will release its advance estimate of 4th quarter 2008 GDP. The 3rd quarter GDP drop was only 0.3%. Based on what the coincident index shows, we can expect a very large GDP decline to be announced Friday. That should light a fire under those in Congress who are pushing the stop button on the stimulus package.
Leave a comment