I remember back a few years ago when I worked at the University of California, Merced, I worked on the third floor of a building that was about two blocks from where a Union Pacific rail line operated. A friend/co-worker of mine and I used to joke about how we were going to create an economic indicator based on the frequency of trains that went by per day and how strong the earthquake we felt upon the train passing. If it was a heavy load, the building would noticeably rock. We never got a hold of a seismograph, so our index was only conceptual. Yet, even though it was a joke to us, the actual application of our economic index probably would have been valuable. (For the record, we had named it the “Shaky Index”.)
What economic indicators can you come up with? A lot of people look to the price of gas as a bellwether of future economic expansion or contraction. A host of other commodities are followed by professional and non-professionals to help forecast economic conditions. What else though? What other information that is floating around can be used as a bellwether of economic growth or contraction?
Here are a few ideas…State’s collect taxes and on a monthly basis they publish reports as to how tax collections are performing versus what was anticipated. The level of tax activity is a good reflection of economic activity. For example the State of California’s Controller publishes a monthly cash report that can be found here http://www.sco.ca.gov/ard_monthly_cash.html.
Tourist information can be helpful as well. Las Vegas is a place where wide variety of people visit for many purposes. Many business travelers go there for conferences and families and individuals go there for fun. The broad appeal of Las Vegas makes it a good gauge of economic wellness. As it turns out, the Las Vegas Convention and Visitors Authority publishes a host of visitor statistics monthly. Using some simple current year vs past year analysis, anyone can gain a grasp of whether activity in Las Vegas is expanding or contracting and at what rate. This can be one simple, yet very useful, homemade economic indicator. Statistics can be found here http://www.lvcva.com/stats-and-facts/visitor-statistics/
What other ideas do you have or do you use to measure the economy’s health?