Wednesday, September 16, 2009

Economic Indicators for Modern Times

Here are few (not so serious) Economic Indicators for Modern Times trawled from the web, more specifically from the great site for finance terms - Investopedia

Skirt Length Theory:
Skirt lenghts are predictors of stock market direction. If the skirts are short, the markets are going up and the general confidence is high. If the skirt lengths are bigger, markets are sad & gloomy and confidence is low.

Hot Waitress Economic Index:
Index to measure the state of the economy by measuring the number of attractive people working as waiters. If there are higher number of good looking waiters, then the economy is weak as attractive people generally do not have problems getting higher paying jobs in a good economy.

Leading Lipstick Indicator:
Indicator based on theory that in tough economic times, sales of less expensive indulgences like lipsticks shoots up. This chairman of Estee Lauder consistently noted that during difficult economic times, the sales of his lipsticks went up remarkably.

Aspirin Count Theory:
Market theory that stock prices and aspirin production are inversely related and is a lagging indicator that actually hasn't been formally tested. If the markets are good and prices are higher, fewer people will need to take pain/stress relievers like aspirin.

sports Illustrated Swimsuit Issue Indicator:
Indicator that provides insight on the stock market return for that year based on the nationality of the model on the cover of the Sports Illustrated Swimsuit Edition. The indicator suggests that when the cover model is from outside the U.S., S&P 500 underperforms that year. When the coer model is from U.S., S&P 500 will generate a better return that year.

Boston Snow Indicator:
Market theory that snow on Christmas in Boston will result in rising stock prices for the following year. Clearly there is no logical correlation between a white Christmas in Boston and the performance of the stock market the next year. Most probably that's why this indicator is also referred to as the "BS indicator" ;)

1 comment:

allan Gering said...

Most indicators are classified as leading or lagging. Leading indicators are those that track economic factors that usually change before the general economy and are used to predict future economic conditions.
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