mc2fool wrote:gpadsa wrote:mc2fool wrote:Aha! A crystal ball!Any particular moving average? And how the about 1999, 2001 and other 40+ spikes? ...
Here is a crystal ball
"The Conference Board publishes leading, coincident, and lagging indexes designed to signal peaks and troughs in the business cycle for major economies around the world."
The Conference Board Leading Economic Index® (LEI)for theU.S.
https://www.conference-board.org/topics/us-leading-indicators
"The ten components of The Conference Board Leading Economic Index® for the U.S. include: Average weekly hours in manufacturing; Average weekly initial claims for unemployment insurance; Manufacturers’ new orders for consumer goods and materials; ISM® Index of New Orders; Manufacturers’ new orders for nondefense capital goods excluding aircraft orders; Building permits for new private housing units; S&P 500® Index of Stock Prices; Leading Credit Index™; Interest rate spread (10-year Treasury bonds less federal funds rate); Average consumer expectations for business conditions."
gpadsa
Umm, ok, well, I always thought that stock markets themselves were supposedly leading indicators, and indeed I see they have the S&P 500 as one of the components of their index ... but let's remember, whether now is a good time to buy the S&P500 is the topic of this thread.
And then there's the question (and I don't know the answer) of how reliable such predicted "peaks and troughs in the business cycle" are in predicting future stock market index levels.
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Their Leading Economic Index (LEI) "is a predictive variable that anticipates (or “leads”) turning points in the business cycle by around 7 months" which I'm not sure I see in their presented charts. Indeed, it looks to me like it predicted the beginning and end of the US Covid recession at the beginning and end of the US Covid recession!
As they don't predict global pandemics or wars these old brokers tales are of limited value