The Sad reality during this DEPRESSION is that most people in this country are too stupid to understand the reality of the economy. Most people can not tell you what GDP is. Most do not know how many are unemployed. Most don't know how many apply for unemployment compensation every week. Most do not know what the Index of Leading Economic Indicators is. I guess it is good to live in Ignorant Bliss as long as you do not lose your job or your pension. Still I will put a definition on this string at least once a week for your benefit. Eventually people on this board will learn a little about the economy and will be able to take advantage of economic changes to make money for retirement, instead of lose all your saved money just before retirement. ----------------------------------------------------------​------------- The Index of Leading Economic Indicators (LEI) is an outstanding tool to predict recessions. This index is reported monthly and is made up of economic components that can reflect upcoming changes in the overall economy. The LEI is a weighted average of 10 components. They can be split into financial variables, survey variables, and economic variables. This distinction is important, especially during the current cycle .... Thats because the current cycle is the result of a huge commercial and residential real estate bubble. Financial history teaches us that monetary policy loses a lot of its effectiveness when a bubble bursts. So it makes a lot of sense to have a closer look at the LEIs components. The number of new building permits issued is just one of the economic variables included in the LEI. Financial and public opinion survey variables were fully responsible for the positive LEI during the last two months. That is right, the money the Fed essentially gave to the banks is part of the index. It is referred to as the growth of money (real or otherwise). Another factor is the rise (or fall) in the stock market. Another factor is interest rate spreads. an increasing spread is considered to be a positive. And then (get This!) the gullible public that knows little about the economy is surveyed to determine another large part of the LEI. Right now, most of the gullible public believes that the economy is in recovery because they believe the boldly deceptive economic reports of the Obama administration. Amazing! There are five actual economic variables that made no positive contributions at all to the last LEI! (1.)Average hours worked, (2.)Jobless claims, (3.)Real consumer goods orders, (4.)Real core capital goods orders, and (5.)Building permits With that in mind, in light of the current economic propaganda, the LEI is not accurate in predicting the end of a recession, but can point toward the beginning of one. Though the Obama administration loudly ballyhooed the last LEI, he had almost full control over the outcome and thus the LEI is tarnished.