Monthly Archives: May 2016

The Dynamic Linearly Detrended Enhanced Aggregate Spread: A Long Leading Recession Indicator

  • The DAGS, short for Dynamic Linearly Detrended Enhanced Aggregate Spread, is a derivative of the Enhanced Aggregate Spread (EAS) recession indicator which comes from Robert Dieli.
  • The DAGS can signal, as much as nine months ahead when a cycle peak (recession start) is likely to take place.
  • Armed with that information, investors can make appropriate plans. As of writing (May 2016), it signals, at least to the end of January 2017, a continuation of the expansion phase of this business cycle.

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