More Ways to Decode Economic Statistics

It was a comment that Alan Greenspan made years before he became chairman of the Federal Reserve Board that gave me the idea for my book, The Secrets of Economic Indicators.

The occasion was at a Time magazine Board of Economists conference. Typically in such sessions, seven nationally known economists gather around a conference table at the magazine's main office and furiously debate the economic outlook. My job at the time was to moderate the session and get a story out that reflected the economists' views. Because I had been an economist for a Wall Street bank before joining Time to cover the economics beat, I was fairly familiar with the factors influencing economic activity. Or so I thought at the time.

I vividly recall that when it came time for Greenspan to speak, he suddenly brought up one obscure economic statistic after another to help support his forecast. No one else heard of or followed these measures. The other economists, apparently bemused, just threw glances at each other. Where and how did Greenspan ever locate these indicators? Later that day, when the economists and Time staff shared a working lunch, I sat next to Greenspan and drilled him. How on earth did he manage to locate these little-known nuggets of information, and do they really serve as reliable leading indicators of economic turning points?