Recessions are slippery devils. No one wants to declare one has started, but everyone wants to be the first to say one is ending. Or at least to say-- and this is real economotalk-- that the economy "appears to be contracting at a slower pace."strong> That's the contention of Irwin Kellner, chief economist for MarketWatch and Distinguished Scholar of Economics at Dowling College (Oakdale, NY). 'Prosperity may not be just around the corner," he argues, "but statistical evidence is mounting to suggest that the worst of this recession may soon be past." According to Kellner, here is all the evidence anyone needs to see that the end of this recession may be near: * The Conference Board's index of leading economic indicators has risen for two months in a row. * Producer prices have increased for two straight months. * Consumer prices rose in January -- the first monthly gain in six months. * The Baltic Dry Index (measures cost of shipping key raw materials) has more than doubled from its recent lows. * Existing-home sales rose in December, and participants in our weekly survey think that another rise took place in January. * Pending home sales went up in December. * Builders' confidence inched up this month. * Thanks to lower interest rates, applications for both new mortgages and refinancings of existing mortgages are rising. * Real hourly earnings rose 4.5% in December following a 3.3% increase in November. * An index of consumer expectations rose in January. * Retail sales shot up by 1% in January -- the first monthly rise since June. * The decline in consumer credit moderated in the latest month. * New orders for consumer and nonmilitary capital goods went up in January. * The ISM index of manufacturing went up last month. * The ISM index of services rose last month for the second month in a row. * The money supply is soaring, a sign that there's plenty of liquidity in the economy. * The 3-month London interbank offered rate, a measure of banks' willingness to lend to each other, has dropped to 1.2% from close to 5% a number of weeks ago. * Other measures of the state of the financial markets, like the TED spread and the 2-year swap spread are down, as well. * Prices of credit default swaps for banks have fallen from their peaks. * The corporate-bond markets are thawing out, too; some $127 billion in dollar-denominated debt was issued in January, the most for any month since last May. * Some securities on banks' books are starting to recover in value. Now, by any measure, that is quite a laundry list. And one I can't top--nor do I want to!
