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In macroeconomics, the Sahm rule, or Sahm rule recession indicator, is a heuristic measure by the United States' Federal Reserve for determining when an economy has entered a recession. [1] It is useful in real-time evaluation of the business cycle and relies on monthly unemployment data from the Bureau of Labor Statistics (BLS).
A new indicator says there's a 40% chance the US is in a recession that started as early as March. The measure builds on the Sahm rule, using job-vacancy data in addition to unemployment data.
The U.S. unemployment rate ticked up to 4.1% in June from 4% in the prior month, nearly triggering a reliable recession indicator. While unemployment is still historically low, its rate of ...
For instance, around when his recession indicator first flashed in 2022, Wall Street's consensus swiftly moved to call for a recession. A broad swath of tech layoffs hit in the coming months.
The indicator is trend-following, and based on averages, so by its nature it doesn't pick a market bottom, but rather shows when a rally has become established. Coppock designed the indicator (originally called the "Trendex Model" [1]) for the S&P 500 index, and it has been applied to similar stock indexes like the Dow Jones Industrial Average ...
With the economy back in recession, in the summer of 1937, U.S. Treasury Secretary Henry Morgenthau Jr. requested Mitchell "to draw up a list of statistical series that would best indicate when the recession would come to an end." [9] [10] In 1938, Mitchell and Arthur F. Burns identified the first leading indicators of revival. Also in 1938 ...
The Sahm Rule, developed by economist Claudia Sahm, says that the US economy has entered a recession if the three-month average of the national unemployment rate has risen 0.5% or more from the ...
A balance sheet recession is a type of economic recession that occurs when high levels of private sector debt cause individuals or companies to collectively focus on saving by paying down debt rather than spending or investing, causing economic growth to slow or decline.