The Conference Board releases its bone-dry Leading Economic Index report of global indicators every month, factoring in the level of the S&P 500, the inflation-adjusted measure of M2 money supply, the interest rate -- yawn.
With respect to leading economists, there are more interesting, and sometimes more telling, indicators. Besides, you'll really know the economy is turning around when you see an uptick in the number of Americans who are leaving their spouses, having babies, popping fewer anti-anxiety pills and buying new teeth so they can eat more hotcakes. To wit:
The pro-cyclic vanity indicator: Economic belt-tightening coincides with a drop in skin tightening, says the Millennium Research Group, a Toronto-based firm that studies the medical industry. So-called "body contouring procedures" are heavily affected by economic factors, as are dental implant procedures, which are generally not covered by insurance claims. (Breast implant procedures and facelifts are only moderately affected by the economy, the firm reports.)
According to MRG, the number of "body contouring procedures" in the U.S. has decreased by 5.7 per cent since 2008. The rate of dental implant (artificial tooth and root replacement) was growing about 10 per cent annually until the past couple of years when it dropped to 8 per cent in 2008 and, so far, less than 1 per cent in 2009. Patients are opting instead for bridges, which are significantly cheaper. Dental implant manufacturers have responded by dropping the price of dental implants, from an average of $274 in 2008 to $271 this year.
Lisa Shantz, an analyst at MRG, says it's fair to predict economic growth based on an increase in tummy tucks, tooth replacements and related medical equipment purchases.
"A lot of these procedures are tied to consumer confidence," Ms. Shantz says. "If they're more confident in the economy, they might be more likely to undergo these procedures because they can see an end to it." (Based on its own metrics, the firm is expecting an economic recovery to begin in early 2010.)
The pro-cyclic divorce indicator: Traditionally, autumn is a boom season for divorce attorneys in New York, particularly those representing well-heeled couples, who wait out the summer in the Hamptons before returning home to cut their marital ties. Last fall was different.
"In September and October of 2008, which would ordinarily be important months for divorce lawyers, the stock market went bananas, and we experienced an extraordinary hit," says Robert Dobrish, a senior partner at Dobrish Zeiff Gross LLP in Manhattan.
In November, respondents to a survey of the American Academy of Matrimonial Lawyers reported, by a two-to-one margin, that they typically see a decline in the number of divorces during national economic downturns. Real estate is a huge factor.
"The apartment is an entity that normally would have represented a third, or maybe 20 per cent, of the entire estate," says Mr. Dobrish, who mainly handles divorce cases that deal in the range of $10-million to $50-million. "And what they've seen is that those apartments -- those $7-million-and-more apartments -- are taking a total bath. They can't even sell them. And that has a definite impact. There has to be enough money for the other person to go out and buy another apartment."
Nationally, the divorce rate dropped from 3.7 per 1,000 in 2006 to 3.6 in 2007 and to 3.5 last year, according to data from the National Center for Health Statistics. Mr. Dobrish has been practicing law for 44 years and says he has never seen worse period than that of the past year. But based on recent stock market indices, he's hopeful that the drought is about to end.
"It is certainly my guess that September, October and November are going to be fantastic for the institution of new divorce cases," he says. "It's been more than a year that people have been holding back, and that's a long time to hold back in a bad relationship."
The pro-cyclic "not tonight, the economy is giving me a headache" indicator: While a recession might keep a couple together for a while longer, it doesn't keep them breeding. In the past decade, economic recessions have coincided with baby recessions. According to the Centers for Disease Control and Prevention, the U.S. birth rate dropped from 4,315,000 in 2007 to 4,247,000 in 2008, a difference of 68,000 births.
The counter-cyclic anxiety indicator: Last winter I overheard a pharmacist apologize to a customer that the store had run out of Clonazepam, the generic form of the Roche drug Klonopin. "You're going to have to come back tomorrow," the pharmacist said. "This has been flying off the shelves lately like it's candy."
In a broader example, Pfizer reported that, while year-on-year revenue was flat from 2007 to 2008, revenue for nerve-calming drug Xanax rose from $316-million in 2006 to $325-million in 2007 and then to $350-million last year.
The pro-cyclic indicator of whether hotcakes are selling like hotcakes: You know the economy's hurting when a restaurant recommends that Americans who can't afford to fly to Hawaii this summer take a "pancation" instead, which is what IHOP did in June.
"Save on the expensive plane trip and hotel fares this summer and instead enjoy the ultimate indulgent 'staycation,' " a company press release read, going on to suggest that potential customers "grab a Hawaiian shirt or grass skirt" and head to IHOP to try its new tropically themed banana macadamia nut pancakes. This followed the January announcement of IHOP's "Hungry Consumer Bailout Plan," an all-you-can-eat pancake deal starting at $4.99 (U.S.).
In July, DineEquity , the parent company of IHOP, reported a decrease in domestic same-store sales. In an earnings call, company chief executive Julia Stewart blamed "the difficult macroeconomic environment."