- by New Deal democrat
Five to ten years ago, I used to have a lot of fun taking the hide off DOOOMers. You know, the pundits who always find some new statistic or other that absolutely shows (for today only! Until the statistic goes the other way, in which case there’s radio silence) that the economy is DOOOMed!!!
Now, the first thing to notice about those “large deviations” to the upside of the Leading Index is just how early they diverged in the last two expansions: by early 2004 in the 2001-07 expansion (i.e., nearly 4 years before the next recession began, and - as depicted in the graph - by the end of 2018 in the last expansion. And then you can see just the tail end of the 1990s expansion, where by 1998 - over two years before the next recession - there is already a big “deviation.”