The Leading Economic Index (LEI) continued its downward trajectory in October, extending the streak of negative reports to 20 straight months. Massive government spending has helped hide recessionary evidence thus far, but that will only make things worse down the road.
In today’s episode of The Call @ Hedgeye, Financials analyst Josh Steiner broke down the latest index data, which provides an early indication of where the U.S. economy is headed. It’s not good.
“In the lead up to the Great Financial Crisis (GFC) and early 2006, it took it well into the 20-plus month time frame for things to really get sort of going,” Steiner explains. “So, it’s certainly not without precedent. And that’s kind of the point. This series continues to deteriorate.”
“In rate of change terms, government spending has taken the baton in the year 2023,” adds Hedgeye CEO Keith McCullough. “Government spending can delay what are traditional cyclical indicators … I don’t think people are set up for that.”
Click here to watch today’s free webcast for McCullough’s extended analysis on the government spending problem.