The ECRI, who they are and what is their forecast

ECRI is an independent institute dedicated to economic cycle research in the tradition established by its founder, Geoffrey H. Moore, whom The Wall Street Journal called "the father of leading indicators." Our mission is to advance the tradition of business cycle research established at the National Bureau of Economic Research (NBER) and Center for International Business Cycle Research (CIBCR). When Moore passed away in 2000, his former student, Alan Greenspan, called him "a major force in economic statistics and business cycle research for more than a half-century."

Following in the footsteps of his mentors, Wesley Mitchell and Arthur Burns, Moore developed the first list of leading indicators of recession and recovery in 1950, the composite index method in 1958, and the original index of leading economic indicators (LEI) in 1967. Today, ECRI represents the third generation of researchers carrying on this tradition of cyclical investigation. Standing on the shoulders of these giants, we have refined the scope and accuracy of cyclical forecasting tools to the point where ECRI can reliably predict the timing of cyclical turns.


December 2009
ECRI Outlook
Job growth will soon turn positive, but a (new) U.S growth rate cycle downturn could begin in the first half of 2010.

As we said in Nov. 2009, the implication is that, "unless we are about to experience a long expansion, it will be many years, and possibly decades, before we see the jobless rate drop to the lows seen only a couple years ago."

But, if the jobless rate – and especially the long-term unemployment rate – stays high over the course of several tightly grouped business cycles, the fiscal outlook would be far more grim... result(ing) in more frequent recessions that ultimately compound the problem.

In sum, with the U.S. economy more likely to dip in and out of recession in the years ahead, it will be increasingly necessary to keep close watch on ECRI’s array of leading indexes.




This ECRI leading index turned negative in late 2007. The market continued to ignore the economic weakness. International companies continued to have great earning. The stock market rallied until July of 2008. The chart above is saying the same thing that it did in 2008. We have a weak economy coming and still the market celebrates the great earnings.

This one is worse than 2008 because this "recovery" was brought on by government stimulus. The nation debt has exploded and we are rolling over again. We need more stimulus to keep this going but remember what happens to countries that spend spend spend. They see their ability to borrow shrink. I don't think we have the ability to do what we did before. That makes this one more dangerous.

Mikey