Economists and analysts are picking apart every statistical report in a vain effort to predict the trough of the current blowout of a recession. The Federal Reserve’s Beige Report was gobbled up by the fearless prognosticators, many of whom divined the beginning of the end of the downturn from this text: “Reports from the Federal Reserve Banks indicate that overall economic activity contracted further or remained weak. However, five of the twelve Districts note a moderation in the pace of decline, and several saw signs that that activity in some sectors was stabilizing at a low level.”
The Conference Board Leading Economic Index declined again in March. It hasn’t risen in nine months. But the rate of decline seems to be easing: it fell 0.4 percent last month, 0.6 percent in February, and 0.9 percent in January. Unhappily, the slippage in the Lagging Economic Index accelerated in the same period—down 0.4 percent in March, 0.3 percent in February, and 0.2 percent in January. From this rather muddy evidence the Conference Board’s economist, Ken Goldstein, predicts that “the recession may continue through the summer, but the intensity will ease.”
Not if the wealthy have anything to do with it, perhaps. The American Affluence Research Center reports that its Spring 2009 Affluent Market Tracking Study is a downer. “The outlook among luxury consumers for an improvement in the economy, and their willingness to spend, are at all-time lows for our studies,” according to the center’s Ron Kurtz. The study looks at those with average annual household income of $290,000, average primary residence value of $1.2 million, average net worth of $3.1 million, average investable assets of $1.4 million.
The troubled housing market gave up some grim numbers, too. Foreclosures.com reported that completed foreclosures in March soared to 175,199 homes in March, up 44 percent from February. RealtyTrac’s first-quarter U.S. Foreclosure Market Report counted default notices, on auction sale notices, and bank repossessions on 803,489 properties. That’s nine percent more than the previous period and almost 24 percent more than first-quarter 2008.
Many economists interpreted the March single-family housing starts—flat with February at 358,000—as a sign of an almost-at-the-bottom market. But CreditSights, in its April 17 housing monitor, said: “As new permits continue to decline, new home starts will likely fall in the months ahead… .This weak trend in single-family starts is in line with the new home orders data that we have seen month after month from the [Department of Commerce].”