I wanted to aggregate some of the things that the NBER considers when determining a recession, and provide three links that people can follow to monitor for recession likelihood.
The NBER uses lagging data so they officially declare recessions after they've been under way for some time and sometimes at their conclusion. However, we can monitor the data points that they consider to view whether they are expanding or contracting.
I've included:
You can see that, despite the rightening monetary conditions, real economic variables continue to expand.
I've also included the Sahm Recession indicator by WeatherUmrella. This uses a 0.5 increase in unemployment over 3 months to indicate that a recession is underway. tradingview.com/u/WealthUmbrella/
Links:
I'll keep this chart public (hopefully it's helpful). tradingview.com/chart/ktiDxgjT/
Sahm Rule official at the Federal Reserve fred.stlouisfed.org/series/SAHMREALTIME
Smoothed probability of recession fred.stlouisfed.org/series/RECPROUSM156N
The last uses the same criteria as the NBER, using some matrix algebra to use what's available to extrapolate a real time determination. It's been very accurate.
The NBER uses lagging data so they officially declare recessions after they've been under way for some time and sometimes at their conclusion. However, we can monitor the data points that they consider to view whether they are expanding or contracting.
I've included:
- Non-farm payrolls
- Consumption
- Household employment
- Real GDP
- Gross industrial output
- Real personal income less transfer payments
You can see that, despite the rightening monetary conditions, real economic variables continue to expand.
I've also included the Sahm Recession indicator by WeatherUmrella. This uses a 0.5 increase in unemployment over 3 months to indicate that a recession is underway. tradingview.com/u/WealthUmbrella/
Links:
I'll keep this chart public (hopefully it's helpful). tradingview.com/chart/ktiDxgjT/
Sahm Rule official at the Federal Reserve fred.stlouisfed.org/series/SAHMREALTIME
Smoothed probability of recession fred.stlouisfed.org/series/RECPROUSM156N
The last uses the same criteria as the NBER, using some matrix algebra to use what's available to extrapolate a real time determination. It's been very accurate.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.