Are you sick and tired of poring over the latest jobs number or PMI figures hoping to get a read on the economy? There is another way. Nicholas Colas, chief market strategist at ConvergeX, says some off the best measure of economic health can be found off the grid economic.Following are some of his favorites.
Pickup truck sales
"When you look at pickup trucks, the really big ones that small businesses buy, demand for pickups is really a very good proxy for small business confidence,“ said Colas. In large part, that’s due to the appeal of pickup trucks across a wide range of sectors. They’re used in energy, farming, landscaping, homebuilding and so much more. “These are expensive vehicles and they burn a lot of gas. People buy them when they can afford them and when they need them,” Colas explained. Looking at the latest numbers Colas added, “Sales are up year over year. For the quarter to date, we’re talking 5-7% up. That’s a positive trend.”
Supplemental Nutrition Assistance Program applications
Colas said that applications for the Supplemental Nutrition Assistance Program, commonly called food stamps, reflect the depth of the economic recovery. “At the peak of the downturn, there were 47 million Americans on food stamps. Today there are 45 million people on food stamps. That’s 15% of the population.” “That suggests the economic recovery isn’t reaching the lower strata of society. They’re still hurting badly.”
“Guns are really a durable good,” said Colas. “I think of guns like a washing machines.” In other words, a gun is relatively expensive and it lasts a long time. “Before the recessions between 8 and 8.5 million units were sold each year. Now it’s over 20 million units for the last 2 years running.” Colas said, “On the upside, gun sales suggest that consumers have more money to spend. However, he added it also suggests there’s unrest many years after the worst of the downturn.”
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