Economic Indicators
Lately, I have been working on checking important economic indicators such as oil, wheat, gold, silver and the unemployment rate to correctly assess the current economy.
Gold and Silver: Gold closed yesterday at a pricey $782.00 per ounce while silver closed at $13.66. Gold and Silver is a highly important indicator to me because they tell me the overall strength of the dollar. If the dollar goes down…the price of Gold and Silver will go up and vice versa. Gold has gone on a run since September from about $675 to $782, an increase of $107 in about a month and a half. Also, the $DJI has gone DOWN in value compared to real money (Gold and Silver). So while people say the Dow is reaching new highs, it actually peaked somewhere around 2000, and has been going down relative to the overall strength of the dollar.
Oil: Oil just hit $88 dollars a barrel and it is becoming a major economic factor quickly.
Wheat: Wheat has dropped from $190 to $160, not a good economic sign for commodities, but I believe we are still in the 10 cycle of the 20-10-5 rule. The 20-10-5 rule states that for 20 years it is good to be in stocks, for 10 years it is good to be in comodities, and every 5 years a tragedy occurs - example: 9-11.
Unemployment Rate: Unemployment rates have been good this year staying roughly around the 4.5% mark throughout 2007. Even though last month was the worst unemployment number of the year, it is still down 1.4% from when unemployment peaked in 2003. I believe this indicates that the economy is still growing steadily, but how this indicator is measured is crucial to its validity and I still need to do my homework on this aspect.
Scrap metal is also an indicator I am looking at. Think of checking these indicators like checking your blood pressure and pulse. They are general overarching baseline assessments - if something is wrong, one needs to do more testing. Test our economy and listen to its pulse regularly.
October 31st, 2007 at 8:28 pm
Gosh John Paul,
If I would have only known that you were so smart (and such a good person too), I woiuld have paid much , much, much more attention to you when I saw you last at the family wedding!
I was distracted by feeling the need to learn oragamy from - the Minnesota Kid!
Here are two very difficult, finacially and math related questions.
#1 If I had three apples and you asked me for one, how many would I have left?
#2 If you had three apples and I asked you for one, how many would you have left?
Say Hellow to mom and dad . Sincerely, Gene
July 20th, 2008 at 9:09 am
Nice blog, i have added it to my favourites, greetings