Nerds are people too

Since 1946, economists and others who find themselves alone on Friday nights have studied the University of Michigan Surveys of Consumers for indications of consumer attitudes toward the U.S. economy. At its core, the survey measures current conditions and future expectations — but with a focus on the psychology of the consumer. And it’s a remarkably accurate predictor of recession.

Dating back to the 1950s, the index is Leonardo-Messi-accurate in predicting recession, save two false positives: 2011 and 2022. Two misses in seventy years. Your weatherman would kill for that average.

Explaining and understanding the false positives

2011: details ⇒