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To: LLCF who wrote (24972)	10/5/2000 3:49:13 PM
From: LLCF	Respond to of 436258

<In the past, three declines in a row in the leading indicators index has signaled the U.S. economy could be headed into a recession in the next three to six months. However, Christopher said, that no longer holds true. "Rules like that are probably better off just being historical artifacts," he said. "It is really difficult to predict a recession." > Of course!!! ROFLMAO NEW YORK (AP) -- For the fourth consecutive month, a key measure of U.S. economic activity fell slightly, the latest sign that economic growth is continuing to slow, an industry group said Tuesday. The Index of Leading Economic Indicators declined by 0.1 percent in August to 105.7, according to the New York-based Conference Board. The index's decline met Wall Street analysts' predictions. The index, which attempts to forecast economic trends for the next three to six months, stood at 100 in 1996, its base year. Except for a 0.1 percent increase in March, the index has been flat or declining throughout this year. "The flat pace in the leading indicators points to continued moderations in U.S. economic activity," said Conference Board economist Ken Goldstein. "This is reflected in indicators for manufacturing, housing, consumer, labor and financial markets. "The economy is starting to reflect the impact of growth restraints. Interest rate and growth restraints will determine how much slower the economy will be in the last few months of the year." In a separate report, the Commerce Department said new-homes sales fell 3 percent in August, despite cheaper mortgage rates, though they still remain strong. Stocks were mixed following the release of the reports, with the Dow Jones industrial average up 54 points at 10,754 and the Nasdaq composite index was down 23 points at 3,545. Six of the index's 10 indicators -- including average workweek production, vendor performance, index rate spread and consumer expectations -- fell in August. Economist Paul Christopher said the slowdown is natural in a rapidly growing economy. "That is a sign that the economy is not really pausing for a breath," said Christopher of A.G. Edwards & Sons Inc. in St. Louis. "It is going to be a good healthy slowdown." In the past, three declines in a row in the leading indicators index has signaled the U.S. economy could be headed into a recession in the next three to six months. However, Christopher said, that no longer holds true. "Rules like that are probably better off just being historical artifacts," he said. "It is really difficult to predict a recession." Christopher predicts the slightly cooled down economy will grow three percent in the third and fourth quarters. Economists generally believe that a rate of 3.5 percent to 4 percent is what Federal Reserve Chairman Alan Greenspan perceives is ideal for a healthy economy. The economy is still showing strength. Among the index indicators that rose in August were money supply and manufacturers' new orders. The board's Index of Coincident Indicators, which gauges current economic activity, rose 0.2 percent in August to 115.9 percent after remaining flat in July at a revised 115.7. The Index of Lagging Indicators, which reflects changes that have already occurred, increased by 0.3 percent to 105.6 after remaining flat in July at a revised 105.3. The three indexes are used together as a barometer of overall economic trends. DAK