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To: yard_man who wrote (108716)	6/14/2001 9:18:37 AM
From: Terry Whitman	Read Replies (1) \| Respond to of 436258

So. Indiana Employment Report: 1) Local tile factory shuts down, lay-offs for couple hundred decent paying jobs. Last big manufacturer in that county. 2) There has been an easing in the engineering and science personnel shortages. Organizations are no longer having difficulty hiring engineering help for the first time in many years.. TW, Your on the spot reporter. <g>

To: yard_man who wrote (108716)	6/14/2001 10:23:32 AM
From: Ilaine	Read Replies (3) \| Respond to of 436258

OK, there are some series looking at debt-to-GDP ratios: Government (external) debt to GDP: livablecommunities.gov This one is very common - if you input - debt gdp ratio - into google, you'll see similar series for Canada, India, Indonesia, Jamaica, etc., etc. Ireland: ntma.ie India: rediff.com Central Asia: ecosecretariat.org Zambia: bized.ac.uk Pretty much everywhere: wbln0018.worldbank.org What I was grasping for last night is the concept of testing and back-testing an indicator to see if it's meaningful, that is, is there a statistically significant correlation between that indicator and some other economic event. To test that I think you'd need training in statistics, otherwise I think you're just looking at pretty pictures. You probably have taken statistics so you know the concept of statistical significance - even so, something can appear statistically significant and just be a coincidence. So the test needs to be run again, replicated by others. The goal of economics is being able to predict the future, right? It's kind of like meteorology - anyone can tell you that it's raining right now. Most people can tell you that it's going to rain soon. A meterologist can tell you that it's likely to rain tomorrow - which doesn't mean it's going to rain, but if you're prudent you'll carry your umbrella. Excessive public debt is significant because it crowds out private investment. Maybe we can test Corrigan's ratio ourselves. How would we set it up? What are we looking for? What is the significance of private debt to GDP? I mean, what should it tell you that aggregate private debt doesn't already tell you? What's the hypothesis here? It seems to me that private consumer debt has two major significances (is that a word?): - if the borrower can't borrow any more, then there's no more purchasing power; - if the borrower can't service the debt, then the borrower may default. In neither case is it meaningful to look at aggregate numbers, IMO. A little old retired lady or a college student doesn't have the same ability to borrow and repay as a two-earner couple in their prime earning years. My bet is that the ratio of debt-service-payments-to-disposable-personal-income tracks recessions (GDP) better than aggregate private debt, but I couldn't tell you whether it's a leading indicator or a lagging indictor. I'd bet it's lagging, not leading. My guess is that aggregate corporate debt-to-GDP is more significant, but again, I couldn't tell you whether it's a leading or lagging indicator. Maybe Mark can do one of his charts? I don't know whether Excel will give statistical significance, but maybe just looking at the pictures would tell us something. But I think we need to take it out at least 20 years, longer if possible.