As spring approaches, the U.S. economy appears solid based on primary metrics like GDP growth and low unemployment. However, subtle secondary indicators suggest potential trouble. Just as a baseball manager might replace a pitcher showing signs of fatigue despite a good score, economic analysts are concerned by declines in secondary measures, such as the Empire State Manufacturing Survey and consumer sentiment. These indicators, while individually weak, collectively signal a potential downturn, emphasizing the need for vigilance beyond headline statistics.
The early warning signs of an economic downturn often turn up in places that are, on their own, not terribly definitive.
A baseball manager might pull a pitcher whose fastball velocity slips by even 2 or 3 miles per hour, resembling early signs of economic fragility.
It's the peripheral indicators that hint at trouble ahead, reflecting a situation where the economy appears stable based on primary measures.
It's not the survey in isolation that's worrying; it's that it comes after similar weakness in consumer sentiment and independent business surveys.
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