Leading indicators for major crashes
Each of the last three major crashes was preceded with a yield curve inversion and a rapid decline in heavy truck sales.
The transport sector, especially truck sales, are intimately correlated with economic activity and are widely regarded as a leading indicator of the health of the economy.
One of the first things that happens when things slow down is businesses stop buying new trucks.
A similar indicator is the number of building permits issued, which also tracks economic confidence in a similar way but more weighed towards the real estate market (not shown).
The yield curve inverting is literally the entire monetary system pricing in an economic growth problem in the near future.
Using the yield curve, truck sales and housing permits is like asking the monetary system and real businesses if they think something's on the horizon.
These indicators come more frequently than earnings which come quarterly, which is why they are particularly useful.
The transport sector, especially truck sales, are intimately correlated with economic activity and are widely regarded as a leading indicator of the health of the economy.
One of the first things that happens when things slow down is businesses stop buying new trucks.
A similar indicator is the number of building permits issued, which also tracks economic confidence in a similar way but more weighed towards the real estate market (not shown).
The yield curve inverting is literally the entire monetary system pricing in an economic growth problem in the near future.
Using the yield curve, truck sales and housing permits is like asking the monetary system and real businesses if they think something's on the horizon.
These indicators come more frequently than earnings which come quarterly, which is why they are particularly useful.
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