Watch Out for These Economic Recovery Signs

Keep an eye out for slowing pasta sales
By Nick McMaster,  Newser Staff
Posted Feb 9, 2009 4:52 PM CST
Pasta is seen on the shelves of a shop in downtown Milan, Italy, Wednesday, Sept. 12, 2007.   (AP Photo/Antonio Calanni)
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(Newser) – We knew the economy was toast when the GDP dropped 3.8% in the last quarter. But such data lags behind the real economy, writes Dan Kadlec in Time, so watch out for these indicators of a turnaround:

  • Home sales. They started the downturn, so any upswing is a good sign. One economist says he'll feel better when a key house market index rises from 8, a pitiful low, to around 20.
  • Temporary Hiring. Firms that have slashed payroll will eventually see business pick up, and will turn to temp agencies for the increased workload.

  • Car Sales. When vehicle sales tick up, you'll know the fear has gone. New vehicle sale rates are still slumming at around 10 million unites; look for them to increase.
  • Interest rate spreads. A 10-year treasury bond yields 3%, 4 points lower than an average 10-year corporate bond. That spread says firms are failing to attract investment. A 2% difference would be better.
  • Pasta sales. Pasta is cheap, so Americans buy more in tough times. Watch for shares of the American Italian Pasta Company, which ballooned to $26 from $5 in a year, to drop again.
For more indicators, click on the list below.