The Conference Board announced yesterday that the leading index continued to fall in November, down another 0.4% m/m.  This is after a downwardly revised .9% percent decline in October.  This decline was lead by large declines in building permits, stock prices, and initial unemployment claims.  All of these issues continue to overshadow the continued positive contributions from real money supply (M2) and the yield spread.

My research tells me that leading indicators typically bottom out about six months before the bottom of the economic cycle.  With that being said, the LEI is at its lows for the the cycle on a year-to-year basis there appears to be no short term easing to the downward economic momentum in sight.  Another indicator is the Conference Board’s Employment Trends Index (ETI).  This metric tends to lead job growth by 3-6 months.  If the economy bottoms sometime in the next 12 months, the labor market is not poised to recover until 2010.  That is sometime off, but the short term economic outlook for the US Consumer and Worker is not positive.