I have written extensively about the data behind the headline media reports. I have also discussed the importance of the relationship between the underlying data trends relative to broader macroeconomic perspectives. However, it is sometimes helpful just to view the various economic indicators and draw your own conclusions outside of someone else’s opinion.Â
With the economy now more than 5 years into an expansion, which is long by historical standards, the question for you to answer by looking at the charts below is:
“Are we closer to an economic recession or a continued expansion?”
How you answer that question should have a significant impact on your investment outlook as financial markets tend to lose roughly 30% on average during recessionary periods. However, with margin debt at record levels, earnings deteriorating and junk bond yields near all-time lows, this is hardly a normal market environment within which we are currently invested.
Therefore, I present a series of charts which view the overall economy from the same perspective utilizing an annualized rate of change.  In some cases, where the data is extremely volatile, I have used a 3-month average to expose the underlying data trend.  Any other special data adjustments are noted below.
If you have any questions, or comments, you can email me or send me a tweet: @lanceroberts
Leading Economic Indicators
Durable Goods
Investment
ISM Composite Index
Employment & Industrial Production
Retail Sales
Social Welfare
The Broad View
Economic Composite
(Note:Â The Economic Composite is a weighted index of multiple economic survey and indicators -Â
read more about this indicator)
If you are expecting an economic recovery, and a continuation of the bull market, then the economic data must begin to improve markedly in the months ahead. The problem has been that each bounce in the economic data has failed within the context of a declining trend. This is not a good thing and is why we continue to witness an erosion  in the growth rates of corporate earnings and profitability.  Eventually, that erosion combined, with excessive valuations, will weigh on the financial markets.Â
