A "Last Gasp" Growth Rate Spike in the US Economic Rebound is Further Confirmed and is More Bearish Timing for the Stock Market
by Bob Bronson, Bronson Capital Markets Research. February 3, 2004
The first chart below illustrates the three-month moving average and November peak in the CFNA Index, which is more of a coincident business cycle indicator. Last Thursday's reported December data is back below the September level of economic expansion, following which we opined it was confirming the "last gasp" growth rate spike in third quarter GDP, and thus the beginning of the
This probable growth rate peaking of the economic rebound is also reflected by the ISM index peak (second chart below), which has just been updated with ISM's just reported revised data for the past four years. The revised three point (300 basis points) drop from the mid-66's to the mid-63's has gone unnoticed by the financial media in their reports today, but the 16% decline in the rate of expansion (from the 50 neutral level) in the manufacturing sector further confirms our bearish analysis for the stock market.
We re-emphasize the "last gasp" growth rate spikes timing parallel with January 1973 ISM Index, which presaged the C down leg of that ABC zigzag BAAC Supercycle Bear Market.
See http://www.financialsense.com/editorials/bronson/103103.html
© 2004 Bob Bronson
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