When Will the Economic Recession End? How to Know In Advance
That’s right – I’m going to show you what thousands of economists, financial planners and analysts the world over struggle to find: How to know when the economic recession will end, and how to know it in advance.
Times during an economic recession always seem tough, but there comes a time when they come to an end. Imagine if you or your business were ready to take advantage of the new economic times because you saw it coming? Or maybe you could have your resume ready for that new job offer, just as more jobs become available.
“Enough already – how do I tell when the recession will end?” I hear you ask. Let’s find out – it may be simpler than you think.
And your children will probably tell you it is easier to do than a night of homework!
For the answer we look to Ken Fisher in his book “The Wall Street Waltz”. It’s actually where the stock market comes in to play, because the stock market, believe it or not, has a magical way of leading the overall economy. In fact, the stock market will go down well before we ever hear word of a recession, and the stock market will go up long before we get confirmation that the economic recession is over.
Don’t believe it? Let’s look at our most recent example: the 2008 recession. The market started going up in March 2009, and the economic recession was announced over in October 2009 – a lead time of around 5 months. Or perhaps the recession before that – 2001 to 2003. The market started rising in March 2003, and the recession was announced over in July – 4 months later.
Or further: in late 1952 the market topped out. Half way through 1953 the recession was declared. The stock market had done it again!
We can see the same pattern in 1957, 1960, 1967, 1970, 1974, and then in more recent recessions like the early 1990’s and 2002. The average time-frame that the stock market leads the economy by is 6 months. Of course some will be more, and some will be less, but as a general rule 6 months is a good one to go by.
So what does this mean for you? Well, the next time a recession hits (and it will), keep a close eye on the stock market. When it starts to rise, in 6 months time you’ll be ready to take full advantage of a booming economy!
Get your free course on , at Dave McLachlan’s site ASXmarketwatch.com. Dave also offers independant to help people just like you.
Related posts:
- Understanding Current Economic Conditions: A Peek at the Global Stock Market It's been a difficult year for economics all over the...
- Be Fully Invested When The Next Bull Market Starts – Showing You How If the stock market is rising and giving you solid...
- Currency Profile Of British Pound (Part II) Despite the independence of the Bank of England (BOE), its...
- Position Trading Explained (Part I) There are four style of trading: Scalping, Day Trading, Swing...
- Currency Profile Of GBP (Part I) GBP/USD is the most liquid currency pair in the world...
Related posts brought to you by Yet Another Related Posts Plugin.