Our friend Matt Busigin, who writes the blog Macrofugue, has sent us 3 brilliant charts that give some much-needed context to the recent economic data.
What they do is look at the average progression of various data points in the 12 months before a recession (black line) and compare that to the progression of that same datapoint right now (blue line).
So for example, here’s the average progression of YOY growth in auto sales in (black line) vs. the YOY growth in auto sales over the last 12 months.
As you can see, the trend is nothing recessionary at all.
Here’s another one showing ISM employment. Again, same idea. The average pre-recession trend is in black and the current trend is in blue.
The trend is again much better.
And finally, here’s retail sales growth. The YOY change just doesn’t look at all like past recessions.
Good news for everyone. Bad news for all the gloomers who predict an imminent downturn.