Here’s what the Chicago Fed National Activity Index (CFNAI) 3mo rolling avg looks like in a trailing time series….

March 2017 CFNAI 3mo avg

Mr Dudley (NY Fed Prez), someone’s going to need to spike the punch bowl again by July-Aug.  This forecast is based on the Greedometers, not the CFNAI. That said, we should expect a rolling 12mo sum of the 3mo avg of CFNAI to drop to -2.7 or lower by July-Aug.

Note: before things melted down last time it looked like this:

  • Jul 2007 new all-time SPX & Dow highs
  • Oct 2007 re-test those highs. Greedometer readings far lower than July 2007.(DING!)
  • Dec 2007 economy enters recession. BEA (Commerce Department) first posts a public note we’re in recession at the end of October 2008 –after the global financial crisis and after the SPX  had been nearly cut in half from 1560 to 800.
  • Dec 2007: Rolling 12mo sum of the 3mo avg CFNAI drops to -2.12.
  • Dec 2007: Wall St sees higher markets in 2008. link to Barrons article Dec 2007.


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