Ahead of the Curve

CHAPTER SEVEN

Consumer Spending Drives the Demand Chain in the Economy

Chapters 4 and 5 explored the two major flaws associated with most conventional economic data tracking and charting.

• The recession obsession has prevented many forecasters from focusing on rates of growth instead of absolute growth and declines, and this misdirected approach to measuring economic harm has led to perennial tardiness among businesses and investors in identifying economic turning points.

• Poor charting and tracking methods—particularly a widespread reliance on quarter-to-quarter comparisons—have obfuscated economic cause-and-effect relationships that exist and that with improved charting might have been effectively used to aid us in more deftly forecasting ...