GOLDMAN: THE MOST RELIABLE GLOBAL ECONOMIC INDICATORS
What are the most important global economic indicators? Â Well, according to Goldman’s Jim O’Neill they’re not exactly what you might have expected (via Business Insider):
“There are some indicators which are simply more powerful in their reliability than others, as well as having predictability in shores beyond their own. In my view, the Korean trade data, US job claims, the US ISM report and its new orders and inventory component, the Euro area business and consumer confidence surveys, especially the German IFO, are the key numbers I look for each month. I do find myself often wondering whether one misses something from the Growth Market world, but if you throw in a couple of key Chinese monthly statistics, their monetary data, PMI, trade and monthly retail sales numbers in particular, then you kind of have most of what you need.”
I would certainly throw in a few more indicators here.  Global industrial production figures are always important.  Japan’s Tankan Survey is helpful.  Out of all of these I’d argue that the Chinese monthly PMI is the strongest indicator of global economic growth.
Cullen Roche
Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.
Follow Me:
7 Comments
This is a biggie: http://www.bloomberg.com/news/2012-03-04/china-targets-7-5-growth-this-year-as-european-debt-crisis-slows-exports.html
China cut their GDP growth target from 8 to 7.5%. Their exports are slowing. What are the latest trade figures from S. Korea? Are they slowing also?
I’ve honestly never followed the Korean trade data. Was surprised to see it on his list….
Korean exports are up: http://www.bloomberg.com/quote/KOEXTOTY:IND
What is the likelihood that less than 75% of the holders of Greece’s bonds will accept the bond swap this Thursday 3/8?
http://www.bloomberg.com/news/2012-03-04/greece-debt-swap-deadline-this-week-to-show-if-europe-moving-past-crisis.html
The EU banks will fall in line. If you are addicted to ECB candy you have to do what the candyman says.
http://www.marketwatch.com/story/chinas-not-so-miraculous-recovery-2012-03-05?dist=beforebell
“China continues to add to its [over-]capacity. If China is unable to absorb this new capacity domestically, then it might seek to increase exports, in order to maintain production and growth, increasing a global supply glut.
Driven by spending on unproductive investments, China’s growth is economically destructive and ultimately carries the seeds of its own demise. ”
Satyajit Das
What, Ben Worry?
http://chart.ly/6vhh699