CHART OF THE DAY: David Rosenberg's Recession Indicator Flipped Positive Today
In October, Gluskin Sheff economist
The year-over-year change in the three-month moving average of nondefense capital goods orders excluding aircraft and parts (also referred to as "
Rosenberg considers this chart the purest look at what businesses are doing with their cash.
Today's durable goods report revealed a surge in core capex in January. Nondefense orders ex-aircraft and parts jumped 6.3 percent, way above economists' estimates of a flat reading.
Perhaps fiscal cliff fears have been allayed for now.
Now – lo and behold – Rosenberg's recession indicator has finally moved into positive territory, albeit only slightly.
Is the U.S. economy out of the woods? Of course not – but at least at the moment, it looks like businesses are spending again.
That seems better than the alternative.
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