4/30/15

Is a recession around the corner?

 

Is a recession in the cards? I have shown you in the previous posts the economy was weak and weakening. Things have not changed much.

The above chart shows the growth of capital good excluding aircrafts (blue line) and the change in backlogs (red line) - the lifeblood of any company.

Orders are slowing down quite sharply and have actually declined -4.0% y/y.

The point is the economy is weak and slowing down sharply. If these trends continue business will be in trouble.

This is bad news for profits, which have been declining. I discussed this possibility in previous posts.

The business cycle is alive an well in spite of the efforts to abolish it made by our leaders.

More details in The Peter Dag Portfolio on www.peterdag.com
 
George Dagnino, PhD
Editor,
The Peter Dag Portfolio
Since 1977
Author, Profiting in Bull and Bear Markets
No. 1 bond timer in the past 12 months. 

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