"Our index includes four indicators. The dollar volume of insider buying shows what managers honestly think about their own companies' prospects. Spreads on bond yields give a sense of what investors think of the chances of recovery. Road congestion at peak travel times (as measured by traffic tracker Inrix) tells us whether businesses are buying, workers are commuting and shoppers are shopping. Finally, mentions of the word "recession" in the news media illustrate the degree to which the downturn is on the public's mind.
Testing back over the last five years, we find that the Forbes Chirp Index typically leads economic activity by ten months which brings us to the possible August recovery. More road congestion and insider buying nudged the Chirp Index higher in November, overriding an increase in the number of mentions of the word recession."
My Comments:The bigger question is the contours and the strength of the eventual recovery. Consumption boom of yesteryears seems unlikely. Direct government spending needs to step in to fill the gap. Infrastructure focused investments would be the winners in this scenario.
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