Week in Review: May 6-10

Quirky Indicators, Consumer Sentiment, & More

People love quirky economic indicators. Take the Men’s Underwear Index, made popular by former Fed Chair Alan Greenspan, which allegedly predicts recession because men stop buying underwear during hard economic times. Never mind that the Men’s Underwear Index a) isn’t a published indicator, b) wouldn’t tell us if a recession was coming even if it was, and c) is obviously less helpful than more standard measures like overall retail sales. The same is true of the Lipstick Index, the Hemline Index, the Big Mac Index, and the Chai Latte Global Index.

The preference for these unusual measures is like reading the horoscope section of a newspaper instead of the actual news; it might be more interesting, but it’s also significantly less helpful.

Which is to say, this was an unusually light week for economic data, so I’ve included a few less common indicators in this review (though none as whimsical as the MUI). Note that a handful of these were published over the past month instead of this week.

Monday

Senior Loan Officer Opinion Survey

Lending standards for commercial and industrial remained basically unchanged at about four out of five banks over the past three months; a few banks eased standards, and a few more tightened them.

About a quarter of banks tightened lending standards for construction loans. Big picture, we’re looking at interest rates staying higher for longer, and that means tighter (or just still tight) lending standards and weaker demands for loans.

TSA Checkpoint Travel Numbers

The number of passengers screened by TSA accelerated to about 6.5% above 2023 levels. People keep traveling, and there are signs this will continue through the summer.

Tuesday

RLB Crane Index

This indicator tracks the number of cranes operating in 14 U.S. cities and serves as a simplified measure of construction activity in various markets. In the first quarter of 2024, the number of cranes fell 9% from the third quarter of 2023 (this is a biannual measure) and 14% from the first quarter of 2023.

Gas Prices

Gas prices fell by $0.01 per gallon last week. It appears increasingly likely that we’re past the spring peak in gas prices.

Diesel Prices

Diesel prices fell to $3.89 per gallon, the lowest price since the last week of January.

Wednesday

Economic Policy Uncertainty Index