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A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

ECRI Insights

Over three generations of business cycle research, we have helped to advance the understanding of business cycle dynamics, some of which we have shared publicly.

The excerpts and papers collected here reflect a sampling of important concepts pioneered by our research group.

Ideas

  • The Yo-Yo Years

    March 2012 | by ECRI

    The convergence of two cyclical patterns virtually dictates an era of more frequent recessions in developed economies. As a result, and because of the Bullwhip Effect, growth in developing economies is going to be jerked around more than people think, making for a good deal of cyclical economic contagion. In other words, we are now in the yo-yo years.

  • Mr. Greenspan's Blind Spot

    March 2011 | by ECRI

    Alan Greenspan accepts ECRI's long-held criticism that the Fed is chronically behind the curve because of its reliance on core inflation and the output gap. But he is wrong that no indicator can predict when inflation is about to take hold.

  • More Frequent Recessions

    March 2010 | by ECRI

    The convergence of lower trend growth and higher cyclical volatility will lead to more frequent recessions, keeping the jobless rate cycling around high levels and spelling the death of buy-and-hold strategies for stocks.

  • When to Put Your Money Under Your Mattress

    October 2009 | by ECRI

    Selling (buying) stocks before recessions (recoveries) based on ECRI's real-time calls would have doubled the returns from a buy-and-hold strategy, beating the S&P by more than eight percentage points a year over the past decade.

Papers

ECRI History

ECRI History

Three generations of cycle research.

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Testimonial

ECRI can justify a certain smugness now that business cycles are back in fashion. The institute called the last two recessions and the current recovery months ahead of the pack.
- Harvard Business Review
ECRI is perhaps the only organisation to give advance warning of each of the past three recessions; just as impressive, it has never issued a false alarm.
- The Economist
This approach works like a charm.
- Forbes Magazine
ECRI continues to be an important resource in determining our tactical allocation. For over a decade their economic cycle forecasts and detailed research topics have been a critical part of our decision making process.
- ECRI Professional Member
In March [2009], the month the market scraped bottom, ECRI went forth with [a] tablepounding historical observation… The implication could not have been clearer that a market rally, when it started, would be no sucker's affair but the real McCoy.
- Grant's Interest Rate Observer
[T]he Economic Cycle Research Institute [is] a private forecasting group with an excellent track record.
- The New York Times
           

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