Business Cycle Indicators as of 3/1/2020

Business cycle indicators that NBER examines (along with others):

Figure 1: Nonfarm payroll employment (blue), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink), all log normalized to 2019M01=0.  Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (2/28 release), and author’s calculations.

Here is the picture using nonfarm payroll series estimated off of Quarterly Census of Employment and Wages (see discussion here).

Figure 2: Nonfarm payroll employment based on Quarterly Census of Employment and Wages (light blue), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink), all log normalized to 2019M01=0.  Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (2/28 release), and author’s calculations.

50 thoughts on “Business Cycle Indicators as of 3/1/2020

  1. New Deal democrat

    The downturn in Q1 2019 in several metrics was probably related to tariffs and the government shutdown. Note there is a second possible inflection point in August 2019.

    If you were to graph the personal income component, you would see that typically there is a 40% or greater deceleration from YoY peak growth prior to recessions. December hit that target, and January came in at 39% off YoY peak growth in the past 12 months.

    So the most important positive has been payrolls.

    Of course, all bets are off with the potential coronavirus pandemic. I am particularly paying attention to two weekly measures of chain store sales.

  2. Moses Herzog

    I may be trying to eat my cake and look at it too here. As I said in the early stages I didn’t think the COVID-19 would amount to much. However, one thing I did think had the biggest possibility of presenting true danger. That is if Chinese officials knew this was spreading (which they apparently did, some say rumors were circulating for “weeks”, “weeks” here to me implies over a month. So what does that mean?? Obviously, means it has been spreading in a “stealth mode” from person to person over a longer time, and possibly some things diagnosed (by doctor or even self-diagnosed) as a “heavy strain of flue” earlier, may have been something else.

  3. Moses Herzog
    Can anyone else hear Elton John singing “Can You Feel the Love Tonight” ??

    Don’t worry Barkley, Copmala sends her love also. She’s finishing her meal at The Choptank tonight in D.C. Copmala’s favorite dining hangout:

    BTW, Copmala agrees with you Barkley, Vanilla Ice is the dope-est rapper of all time. Emphasis on the dope, because Copmala knows it’s like super cool when college students on the upwardly mobile career track smoke cannabis, but imprisonable when “the lower castes” do it. You know how it is with keeping your street rep, eh Barkley??

  4. Moses Herzog

    I copied this off of Nate Silver’s “538” blog. The specific article was written by Nathaniel Rakich:
    395 194 50 33 540 133

    That’s the TOTAL delegate count breakdown they have for Super Tuesday, I believe it was compiled BEFORE Buttigieg dropped out. The link below explains how Nate Silver and the “538” crew have Buttigieg’s dropping out effecting the primary race’s end result. It’s not especially helpful to Sanders, but could, although very marginally, help Biden and Warren.

    1. pgl

      If both BUTTIGIEG & KLOBUCHAR drop out and if Biden captures their predicted share, Biden would have done fairly well. Of course THE BLOOMBERG staying in remains a big favor for Bernie.

  5. pgl

    Decent bounce back on the stock markets today but the story is that the corporate bond yields are taking a hit. I decided to see what was happening to credit spreads on BBB rate corporate bonds:

    ICE BofAML US Corporate BBB Option-Adjusted Spread (BAMLC0A4CBBB)

    Quite the jump since 2/19. Spencer – please take note.

  6. The Rage

    RIght now, it looks like a open convention. Both Sanders and Biden should then release their delegates and then endorse younger candidates.

    1. Barkley Rosser

      What younger candidates? Bloomberg is 78 and Warren is 70. Please do not tell us you mean the execrable Tulsi Gabbard.

      1. Moses Herzog

        Gabbard does know which office she’s running for. That’s always a plus, unless you’re in the group of senior Virginia voters that identify with the quality of senility.

        Oratory skills like this are going to play well on a national debate stage. donald trump is going to have a field day—and we’ll be able to thank the DNC again for forcing upon voters an inferior candidate better suited for a quiet New Zealand nursing home.

        1. Moses Herzog

          It would probably be a personal mistake at this point in Ocasio-Cortez’s career (too risky at this stage from a personal/self-interest standpoint). But she’s well read and intelligent. There’s no reason she wouldn’t make a great VP if she fits the age requirement (don’t you have to be 35 to be a VP candidate??). Who here is going to tell me she doesn’t have a much better capacity to make intelligent decisions than say a Dan Quayle, a Sarah Palin, or a Mike Pence?? Please stepforth all of you who would contend that.

          She’s going to have less “baggage” than say a Klobuchar in defending Bernie’s health care policies, she has a dynamic personality, and she gets young voters enthused to get out and vote. See ZERO downside in Ocasio-Cortex as a VP running-mate. She can even keep her Senate seat up to the election, so nothing is lost on that standpoint either.

          1. Barkley Rosser

            AOC not in Senate. She might be good for Biden, but not for Bernie. He already has Latinos and progressives. She would add nothing for htm. For Biden, Castro might be a good pick or maybe Warren, who might help him reach out to the progressives.

          2. Moses Herzog

            That was a pretty bad mistake, yes I stand corrected. She can keep her House seat. The general point still stands.

            I disagree she adds nothing. She would get MORE Latino turnout and MORE college students out to vote. You’re missing the fact that there’s a segment of people that need to feel a sense of enthusiasm or reinvigorated by “real potential for change” before they will drive out to the polling location. Ocasio-Cortez delivers this kind of enthusiasm and voter turnout. I will give you it’s a subjective thing and debatable, but I strongly disagree with you on that.

          3. Barkley Rosser

            Bur, Moses, Biden is the one who will not have young or Latinos. He needs somebody who can appeal to them to bring them out. Bernie would have a better chance for Arizonsa than Biden. Biden would need especially that Latino vote there to turn out to flip that one, and he may need that to win WH. Bernie already has the youth vote and Latino vote. He will need the African Americans to turn out and the suburban women who gave the House to Dems in 2018. AOC is an outright negative on that latter group, the reason so many “down ballot” Dem candidates have been totally freaking out over Bernie. AOC just guarantees death for them and would seriouslly threaten Dem control of the House.

            But AOC could help Biden, although Castro might do so as well without freaking out those crucial white suburban women.

  7. Moses Herzog

    Let me explain something, to what I believe is a very intelligent. blog readership generally (Menzie attracts an intelligent audience overall, especially “the silent majority” of readers that do not post comments), but who I feel sometimes borderline on the politically retarded.

    So some of these experts on TV, websites, radio, etc. latch on to certain terminology in any given segment of time. I can give an example. During SARS the trendy word was “contagion”. Now the cool word during COVID-19 is “pandemic”. Why was contagion cool in 2002-2003 and now pandemic is cool in 2020?? No one can tell you. They just know everyone else is saying it, so they have to repeat like a psittacine fowl with a small brain. So allow me to explain something to all you dumbos who don’t “get it”. When you hear the term “late-deciding voters” this is “DNC party insider” code for “dumb$hits easily manipulated by the media into thinking candidate X is ‘unelectable’ “. OK?? So now you know what it really means. You’re Welcome.


    1. ilsm

      Linked by Barry Ritholtz, I check his blog every day:

      Food for thought. The other day Barry wrote a post (I cannot find) about acting like a defense attorney when you hear something about covid 19 (or anything else for that matter) from a news outlet. He said “object” and see if the stated position can be “sustained”……..

      I think I will get a 10 pound bag of rice and similar amount of dried black and red beans.

    2. Barkley Rosser


      I realize that hardcore Berniebros like yourself are really losing it today, but you really need to cool off. I happen to like Bernie and voted for him in 16 in VA. I think he is the real thing, and I agree with many of his positions. But he has some serious problems, starting with having just had a heart attack. He is also pushing almost an identical agenda from before, and after that heart attack, turning red in the face while yelling for nearly every answer in debates is not reassuring.

      But the really serious problem has been his uyielding and unrealistic “Medicare for All” that will immmediatly end all private insurance. 60% say they suppott M for A, but that drops in half when it is noted that this means end of private insurance, and immediately. It was the reality of this that pushed both Kamala Harris and Elizabeth Warren to shift from the Bernie position to more realistic ones, but in both cases this led people to view them as impure and awful and so on. But fresman Dems in swing districts who won on running against Trump attacking O-care fully understood that the Bernie versio of M for All would be an electoral disaster, handing both the WH to Trump and the House back to the GOP.

      I would note that single payer is not the best system in the world, nor is the socialized medicine of UK. WHO rates places like France and the Netherlands and some other European ones as having the best. These are all mixed systems, roughly 3/4 public and 1/4 private, with universal coverage, the thing that only the US lacks among all high income nations. in short, there are much better and much more popular ways to get universal coverage than the horribly unpopular single payer plan. It is this more than anything else that had so many Dems running from Bernie to anybody else, who in the end has turned out to be Biden, although I did not vote for any white male over 75 with one of his names beginning with a B this time.

      1. Moses Herzog

        I haven’t read 15/16ths of the above comment, because with Barkley Junior I find reading his comments I learn absolutely nothing and my annoyance levels go off the maximum instrument readings. My only reply is this. If you think a man running for President who thinks he’s running for U.S. Senate and can no longer differentiate his sister from his wife is going to be a good performer on a debate stage, I honestly feel sorry for you. As I feel the only way you can rationalize this is a good idea to choose this man to represent Democrats in a debate, is because you probably exhibit these same behaviors in a classroom context:

        It’s gonna be very humorous watching his poll numbers get hammered 15%+ after making some incredibly dumb verbal statement in a debate with trump, watching you and 2slugbaits tell us all, how none of it surprised you and why trump was going to win anyway, after you both made it abundantly clear you thought this senile dementia victim was the guy you wanted to take on trump head-to-head. You think I gave you a hard time on your Copmala Harris prediction?? Barkley Junior, You better take your vitamin E supplements up to 300% daily recommended intake and and do extra time in your oxygen preservation tank to prep for when I dog you on Biden’s debate performance against the orange creature.

  8. Barkley Rosser

    BTW, we have had a pretty astounding maceo move today (well, now yesterday): the Fed has unexpectedly cut the fed funds rate by 50 bps, and the reaction by the stock market was to turn around from a rise to fall hard. Is this a matter of people thinking the Fed knows wirse information about what is really happening to/with the economy, or is this a matter of people being disgusted by Powell apparently caving to Trump, with this also reminding how incompetent Trump is on the coronavirus? Heck, Trump put Pence in charge of dealing wiith it, and has been holding prayers after shaking hands at a Florida fundraiser with a bunch of students whose classmate has been quarantined. Might he end up like some of those Iranian government figures now sick with coronavirus? What does that do to confidence?

  9. pgl

    The stock market is having a good day. Some reporters are attributing this to the good news for Biden’s campaign. Whoa – that will tick Trump off!

    1. Barkley Rosser

      Well, Trump is not pleased with the Fed’s actions. He thinks they should have cut even further. He says they should go to zero.

  10. Willie

    I don’t think the Fed cut rates because of political pressure. I like to think they didn’t, anyway. They see genuine risks. I still think that even without COVID-19, we were going to see some kind of slowdown, if not a full recession. Now, it’s hard to imagine there won’t be a tough economic climate for a while. Transportation and tourism will be off no matter what. Even though it might be temporary, and those aren’t the biggest sectors of the economy, there will likely be impacts. Supply chains appear to be having disruptions. Who knows. A colleague who knows far more about shipping than I do said that things in China are getting back to normal already, so maybe it’s a non-Corev blip. Then again, my colleague also repeats talking points at times, so I don’t know what to think about some of the things he says.

    I don’t think there’s any way to know whether the virus will continue to spread, whether it will continue to kill people, or whether it has peaked and will slowly become a non-issue.

    1. Barkley Rosser

      Well, Willie, interest rate cuts do not look like they would help against supply chain disruptions, which look to be the most serious direct effect of the virus, not stop cancellations of meetings and such due to it. Best it can do is maybe slow a deeper dive and keep US rates in line as other central banks also cut their rates. OTOH, the Fed will now have fewer tools for if/when we actually do go into a recession rather than maybe going into one that might threaten the reelection of a certain president.

      1. Willie

        That is all true. But my pathological optimistic side wants to believe the fed is at least somewhat independent even now. My less optimistic side thinks we are low on tools for fighting the inevitable recession anyway. We have a massive deficit that is essentially being spent on a beer buzz instead of buying a house. There goes a useful tool. Interest rates are already down near enough to zero that it may not much matter anyway. There’s only so many body blows the economy can take before it ails. I’m a amazed that some of the recent blunders haven’t caused more problems than they have.

        I’m still trying to figure out what interest rate inversions really mean when rates are approaching zero. More uncontrolled experiments to follow, from the looks of things. Flailing as a formal policy? That seems to be the order of the day. The orange guppy has to be stirred up that the press is attributing the market bump to Biden’s wins. The next six months are going to be dizzying in the amount of BS, outright falsehood, and bizarre gyrations. I’m looking forward to the day that the Trump family are back to being nothing more than pampered loudmouths with semi-profitable hotels.

  11. The Rage

    Sanders needed to explain why he woo’d Latin American “revolutionaries” even after it was seen they were just the new dictators in line. You can tell guys like Casto and Che just are his heroes. That vetting hurt him. When Biden won a fairly conservative black caucus in South Carolina by huge numbers, it led to this chain reaction. He also probably had a better ground game up north than people thought. I think he would have been viable for delegates even if the field had remained crowded, with Sanders as the still front runner.

    Bernie wants to win it his way……………totally. Even Trump didn’t do that. You have to work with the party bosses and he instead wanted to destroy it. The party was bigger than him.

    Sadly Warren was the big victim that also needs to drop out.

    Bernie was always critical of the Soviet Union and called them totalitarian in a 1981 interview with Phil Donahue. I ignored his sister city/1988 antics. Reagan was doing the same thing.

  12. baffling

    something that has been happening in texas, especially after the supreme court invalidate the voter rights act. while texas can no longer impose a poll tax, by reducing the number of voting locations, especially in minority areas, a 2 hour long wait to vote has effectively become the modern poll tax. it should be noted voter lines were not nearly as long in some of the wealthier areas of the major cities.

  13. 2slugbaits

    As I recall this econ blogger guy named James D. Hamilton once wrote a paper in which he argued that monetary policy was an ineffective way to combat supply shocks as opposed to demand shocks. Hamilton was arguing against another guy (Ben Bernanke) who argued for monetary stimulus in combatting supply shocks. Personally, I thought Hamilton had the better argument, but the COVID-19 shock might another data point.

    Moses Herzog I think your apparent crush on AOC is clouding your judgment. Even setting aside the age requirement, she brings nothing to a Biden ticket. Running up the score in safely blue states is pointless. We can blame the Framers for that. If Biden wins all of the states that Hillary won in 2016 plus MI and PA he will still be 2 Electoral Votes short of 270. He could pick up those two by winning one additional Congressional district in NE and ME, but that seems unlikely. The possible candidate states are WI, AZ, NC, GA and FL. My view is that NC is the most winnable along with a very winnable Senate seat. So if I were Biden, I would select someone like Stacie Abrams because she would put NC is serious play as well as GA. Klobuchar would help shore up WI and solidify MN, which Trump almost won. I would not pick Warren because the governor of MA is a Republican and the Dems would lose a seat in the Senate. If Biden really wanted to put Warren in the Administration, then the Attorney General would be a good fit, but that would have to be balanced against losing a Senate seat.

  14. Moses Herzog

    I don’t deny having a crush on Ocasio-Cortez. I think I still bleed red blood last time I checked. But seriously, aside from the age issue (if she is under 35 and if that is a legal requirement), I see ZERO problem with her being Bernie’s VP running mate. She’s a terrific talent and she keeps herself well-versed on policy and the topics pertaining to the times we live in.

    1. Moses Herzog

      This was intended as a direct reply to 2slugbaits, apparently I forgot to click the “reply” button. I picked up bronchitis from one of my nut job relatives and my energy level is starting to pick up again but not 100%. It brings down oxygen levels to my brain (that’s not even a joke, come on now people!!!!!). Is that a good excuse for not clicking “reply” with my index finger??

      1. Moses Herzog

        OK, I thought it was but I couldn’t swear to it. I have mixed feelings about this. I think generally it’s a good law, a reasonable law and should be kept as a statute law on the books. That being said I think Ocasio-Cortez qualifies as someone who is an exception to the rule. When I say “exception” I mean I think in her case it’s not important–but the rule should still apply to everyone. In other words, do I think there are some drivers who can drive 80–90 mph and do it safely in a 65mph zone?? Yes I do—that doesn’t mean I don’t think everyone should be required to follow the law, because overall the law works well.

        1. Barkley Rosser

          She can wait a few more years and then become VP for Buttigieg, after he puts a few more years on as well.

          1. baffling

            AOC was one of the rousers that pushed pelosi into the ill fated impeachment hearing. that did not turn out well for anybody. AOC appears to have the same problem as the back bencher tea baggers. they were effective at shouting and complaining, but when they were in a position to legislate and get things done, they were a disaster. they never took any responsibility for any of their ill fated actions. now the question with AOC, will she take responsibility for aggressively pushing for impeachment and failing? or was that somebody else’s failure? i like the energy of the younger generation, but they tend to be too idealistic to get things done in an environment that requires collaboration for success. AOC must learn how to make deals, or she will become another bernie sanders. bernie is a senator, but not much of a legislator getting things done.

          2. Moses Herzog

            @ Barkley Junior You’re showing your cluelessness on politics yet again, with laughable statements about a guy who couldn’t even make it to Super Tuesday. Klobuchar would have gotten more votes than him in the South, which is why a corporate lapdog hated in his own city dropped out like the sad dog he is. You haven’t been missing the old days playing with your confederate artifacts again have you??The fact you think a Congresswoman popular in nationwide polls who commands large crowd turnout at rallies would be 2nd spot on a presidential ticket to a small town mayor, hated by blacks in his own city, (a “bonus” thrown in for you?? I know you’ve shown a pattern there with Copmala) who couldn’t get 5% over the Deep South states speaks volumes on your closet sexism (which you have failed to camouflage with your other nonsense on this blog—you fooled Menzie, NOT me.

            @ baffling . You’re showing why Democrats have been laughed at continually since roughly 1985. A reticence to take any initiative on anything out of fear of failing or disappointing DNC corporate masters, Your entire comment speaks for itself as written by the type of liberal who is scared of being beaten up by his own shadow.

          3. 2slugbaits

            Moses Herzog A long time ago you used to hear the term “limousine liberal.” A limousine liberal was someone who bravely espoused liberal causes all the while secure in the knowledge that if anything went bust the limousine liberal was comfortable enough that he or she wouldn’t be the one suffering the consequences. Statements like this capture the essence of what it means to be a limousine liberal:
            …written by the type of liberal who is scared of being beaten up by his own shadow.
            The reason African-Americans support candidates like Biden is that they have good reason to be scared of losing to Trump and being beaten up. A Trump win for affluent white liberals will be little more than an annoyance, which can be cathartically released by spending a few hours on the internet. But for some voters it’s literally a life and death result. Limousine liberals can afford to cheer on Bernie and AOC. Others have to take politics as something more serious than a debating club.

            AOC is intelligent as well as authentic. There’s a lot to admire. But she’s also impatient. And she could learn some empathy. Given her district it’s easy for her to espouse far left positions, but a lot of her Democratic allies don’t have that luxury. She should spend some time in their shoes. She also needs to learn when to keep her mouth shut. Just as there’s a time to speak up, there’s also a time to shut up. She needs to grow-up. That’s one reason why the Constitution requires the President to be at least 35 years old.

          4. noneconomist

            Progressives and moderates? Take a look at the California vote. Did progressives humiliate moderate candidates? Hardly.
            Sanders currently has about 34%. He’s the top vote getter, but 66% of those casting ballots did NOT vote for him.
            Add in Warren’s 12% and the progressive total is an impressive 46%.
            But that’s not a majority. In a Democratic primary. In California.
            Meanwhile Biden has 25+% and Bloomberg 14+%. Add in Buttigieg and Klobuchar’s 9+% and you can make an honest case for moderates outperforming progressives. That’s 49%. In a Democratic primary. In California.
            Point to consider: if AOC was a candidate for a California Democratic district, she could win in some, not in others. The results indicate no one size fits all. In a Democratic primary. In California.
            Queens is not Fresno or Santa Rosa or Eureka or Huntington Beach or any number of places where moderates are still successful.

          5. baffling

            moses, 2slugs summed up a very appropriate response. but let me place his items in a more concrete perspective. compromise requires one to give up some control in order to continue to make gains. you make claim that i am afraid of my shadow. fine. but here is a the result of being so “fearless”. in 2016 trump ran against clinton, and lost the popular vote but won the electoral college. this means a small number of vote changes in a few states would have produced a different outcome. now here is fact. there were MANY bernie supporters who would not vote for clinton, because she was not “socialist” enough. the result? a trump victory. now at the end of the day, perhaps bernie supporters decided he had a better chance to run again in 2020 if hillary lost rather than won and was an incumbent. but i don’t think that was in their calculus. they were “fearless” in promoting their ideology. in reality, sanders supporters would have gained far more by supporting hillary as president. but instead they got trump, and he stuck it to them. funny thing is, most of these bernie supporters are in denial of this reality. so while i may be afraid of my own shadow, at least i take steps that actually move me towards my goals. people like bernie and aoc have lead the action that actually moved them further from their goal posts. today we have reductions in the number of health care insured and a loss of preexisting conditions protections. deductibles are up and insurance premiums are up. is this where we would be if hillary were president? this is a direct result of a “fearless” unwillingness to compromise. sometimes you simply need to be smart enough to know what battles to fight, if you want to win the war. democrats fought a useless battle amongst themselves last election.

          6. Barkley Rosser


            Pelosi did not do impeachment because of pressure from AOC. AOC had been calling for it for many months while Pelosi resisted. Pelosi acted when the July 25 phone call came out, and I think you are just wrong that it was some kind of disaster, even if Trump did not get removed from office, which nobody expected. Dems stood up for principle, and the whole thing has probably ended up as a wash, although Trump supporters are all worked up. But they are all worked up anyway.


            AOC is plenty smart, but she is not more popular than Buttigieg, who is also smart. They would make a good team, balancing each other off. Yes, he has a problem with blacks, but then so does Bernie, although not as much as Mayor Pete. I was mostlyjoking about AOC and PB, but on thinking about it, down the road they would not be a bad pair.

          7. baffling

            barkley, let me ask the question this way. if there had not been a vocal ruckus amongst some democrats prior to the july 25 phone call, do you still think pelosi would have moved to impeachment proceedings? i don’t think so. she was pressured into it. while there were some heroes out of this proceedings, such as schiff, unfortunately the impeachment relied on some tired old dogs like jerry nadler. i call it a failure, but other than schiff, the democrats had nobody capable of executing the impeachment proceedings. i think nancy knew this, and was one of the reasons for hesitation. failure to subpoena anybody of significance was a fatal blow to the investigation. folks such as bernie and aoc, who were advocating for impeachment, were either unaware or did not care about the fact the democrats did/could not field a team that could win this battle. i think trump is crooked. i think he needs to be held accountable. i think democrats walked backward into this battle, and you saw the outcome. at the end of the day, trumps failure to handle the coronavirus and economic result will render the impeachment moot. but i think those who pushed us too quickly and eagerly into the impeachment should be held to task as well. if you impeach, you need to win.

        2. Barkley Rosser

          BTW, MH, Pete B. may not have made it to Super Tuesday, but he was in the lead in delegates after Iowa for a week. And Bernie is not doing as well as he did in 2016. Seems he is not able to get all those youths out to vote who he is supposed to be able to get out to vote. Uh oh. Even with AOC out beating the drum, who was not around to do so in 2016, the lazy young twerps are sitting on their duffs playing their video games or whatever.

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