The Previous Updates

February 8, 2018

 

Business Cycle Index

BCI-2-8-2018

The BCI at 236.3 is below last week’s downward revised 237.6, and it is below this business cycle’s peak as indicated by the BCIp at 84.5.  Also, the 6-month smoothed annualized growth BCIg is at 16.3, which is below last week’s downward revised 17.3.

No recession is signaled.

 

 


Posted on Feb 8, 2018 | Leave a comment


February 9, 2018

Market Signals Summary:          

The MAC-US model is invested. 

To view this premium content requires membership category: Silver or higher. However, it can be freely viewed after 03-09-2018 16:00 (New York), or please login or register
The MAC-AU is also invested.  The recession indicators COMP and iM-BCIg do not signal a recession. 

 

Stock-markets:

Fig-2.-2-9-2018The MAC-US model generated a buy-signal 4/5/2016 and thus is invested in the stock-markets. The sell-spread (red graph) is below last week’s level and has to fall below zero to signal a sell.

 

 

To view this premium content requires membership category: Bronze or higher. However, it can be freely viewed after 03-09-2018 16:00 (New York), or please login or register

Fig-2.1-2-9-2018The MAC-AU model is invested in the markets after it generated a buy signal on March 21, 2016. The sell-spread is below last week’s level and has to fall below zero to signal a sell.

This model and its application is described in MAC-Australia: A Moving Average Crossover System for Superannuation Asset Allocations.

 

Recession:

Fig-3.-2-9-2018Figure 3 shows the COMP  above last week’s  revised level. No recession is indicated.    COMP can be used for stock market exit timing as discussed in this article The Use of Recession Indicators in Stock Market Timing.

 

 

Fig-3.1-2-9-2018Figure 3.1 shows the recession indicator iM-BCIg  down from last week’s level. An imminent recession is not signaled .

Please also refer to the BCI page

 

 

Fig-3.2-2-9-2018The Forward Rate Ratio between the 2-year and 10-year U.S. Treasury yields (FRR2-10) is at last week’s level and is not signaling a recession.  The FRR2-10 general trend is downwards.

A description of this indicator can be found here.


Posted on Feb 9, 2018 | Leave a comment

Monthly Updates

January 5, 2018

Unemployment

Fig-8.-1-5-2018The unemployment rate recession model (article link), has been updated with the November UER of 4.1%. Based on the historic patterns of the unemployment rate indicators prior to recessions one can reasonably conclude that the U.S. economy is not likely to go into recession anytime soon. The growth rate UERg is at minus 13.97% (last month 13.56%) and EMA spread of the UER is at minus 0.26% (last month minus 0.28%).

Here is the link to the full update.

The Dynamic Linearly Detrended Enhanced Aggregate Spread:

DAGS-1-5-2018The updated level of this indicator, -146bps (last months -133bps), confirms the January 20, 2017 signal. Based on past history a recession could have started at the earliest in October 2017, but not later than May 2019. The average lead time to previous recessions provided by DAGS was 15 months which would indicate a recession start for April 2018. (Note: All our other recession indicators are far from signal a recession.)

 

Coppock Indicator for the S&P500

Fig-9.-1-5-2018The Coppock indicator for the S&P500 entered the market end May 2017.  This model is in stocks.   This indicator is described here.

 

 

CAPE-Cycle-ID

Fig-9a-1-5-2018Fig 9a depicts the CAPE-Cycle-ID and the year-on-year rate-of-change of the Shiller CAPE.  A model using this indicator invests in the market when the Cycle-ID is +2 or 0, and when the Cycle-ID equals -2 the model is in cash. This indicator is described here.

 

 

Trade Weighted USD

USD-1-5-2018 The Trade Weighted $ value is seemingly weakening.

 

 

TIAA Real Estate Account

Fig-10.-1-5-2018The  1-year rolling return for the end of last month is 4.43%.   A sell signal is not imminent.

Read more …

 

 

 


Posted on Jan 5, 2018 | Leave a comment

With reference to Section 202(a)(11)(D) of the Investment Advisers Act: We are Engineers and not Investment Advisers, read more ...
By the mere act of reading this page and navigating this site you acknowledge, agree to, and abide by the Terms of Use / Disclaimer