a good understanding of the measures that determine the economic health is critical to managing your money making business. Economists, Department of Commerce / Trade, Federal Reserve and many other economic bodies and governments and NGOs, concerned about the state of their economies and are always trying that before any adverse development and find ways to prevent happening.
There are five areas of the questions are:
1 Leading Economic Indicators' Index
U.S. Conference Board will release a series of economic indicators index on a monthly basis. However, many of the components are reported in various media, and economists should be aware of the situation. However, this index allows the layman to better understand the overall economy zdravlje.Pravilo is that if there are 3 consecutive increase in the index, it is a positive sign for the state of the economy. However, if there are three continuous decrese in the index, then the negative sign for the economy and the recession may be looming.
2 Unemployment
be a good indicator of the number of applications for unemployment insurance benefits. If demand effects, then it is a sign that the unemployment rate has gone up.
economists and politicians are inclined to see the continuation of high unemployment as a signal for danger. While some level of unemployment is the norm even in a robust economy, the higher the rate, the greater the risk that the economy and society, have serious problems.
On the other hand, low employment rates may carry the potential for higher inflation as employers raise wages to attract new workers.
3 of durable goods
Increasing demand situation indicates that the economy is expanding. It would be a backlog of orders for a wide range of finished products, from machinery to transportation equipment.
4 Housing starts
The measure of economic health than the number of housing permits issued. Typically, a growing economy generates increased demand for new housing. However, over supply situation will dampen the economy.
5 a new factory orders
Rising orders reported by manufacturers of goods and materials confirms the confidence in the economy and suggests continued growth. Conversely, falling or flat demand may signal economic problems.
for the layman, to be understood that the index can not be 100% accurate. In fact, exactly the planned index of economic crisis to 18 months in advance, and correctly predicted the recession of 1991 and 2001. But it also has signaled a recession that never materialized.