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The automated recession indicator model
Recession indicator model
There is no reliable way to predict how and when a recession will occur. But, according to many economists, there are some generally accepted predictors that when they occur together, may point to a possible recession.
This predictive model uses
Inverted Yield Curve (when long-term yields fall below the short term ones)
All yields are graphed however the model reacts to:
1- The 5-year vs. the 3-month Treasury securities
2- The 5-year vs. the 2-year Treasury securities
While it might not seem like much at first glance, the inverted yield curve is actually a rare occurrence that can act as the bellwether for an economic recession.
Since 1970, all the recessions that have taken place in the United States up through 2017 have followed an inverted yield curve.
Unemployment rate
Lagging indicators of a recession include the unemployment rate. Though the Great Recession began in December 2007, the unemployment rate still indicated full employment — a rate of 5% or lower — four months later. The unemployment rate began declining in May 2008 and did not recover until several months after the recession ended in June 2009.
3-Unemployment rate that is falling
This serves as a supplement to my analysis:
-Bellwether-for-US-recession-The-Inverted-Yield-Curve-v2
-Death-Cross-Golden-Cross-Death-Cross-and-back-to-POControl/
There is no reliable way to predict how and when a recession will occur. But, according to many economists, there are some generally accepted predictors that when they occur together, may point to a possible recession.
This predictive model uses
Inverted Yield Curve (when long-term yields fall below the short term ones)
All yields are graphed however the model reacts to:
1- The 5-year vs. the 3-month Treasury securities
2- The 5-year vs. the 2-year Treasury securities
While it might not seem like much at first glance, the inverted yield curve is actually a rare occurrence that can act as the bellwether for an economic recession.
Since 1970, all the recessions that have taken place in the United States up through 2017 have followed an inverted yield curve.
Unemployment rate
Lagging indicators of a recession include the unemployment rate. Though the Great Recession began in December 2007, the unemployment rate still indicated full employment — a rate of 5% or lower — four months later. The unemployment rate began declining in May 2008 and did not recover until several months after the recession ended in June 2009.
3-Unemployment rate that is falling
This serves as a supplement to my analysis:
-Bellwether-for-US-recession-The-Inverted-Yield-Curve-v2
-Death-Cross-Golden-Cross-Death-Cross-and-back-to-POControl/
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.