Feb 18 2008
U.S. Government to Cease Publishing Economic Indicators
In a move reminiscent of the Federal Reserve ceasing its publication of M3 money supply figures in 2006, the U.S. Department of Commerce announced that it will discontinue its Economic Indicators services at www.economicindicators.gov effective March 1, 2008. The site has served as a key public portal to the economic indicators used by the government, the Fed, and the powers that be on Wall Street. It’s so useful that it has won a Forbes Best of the Web awards.
The Data will still be available on other websites, but it will be scattered, more raw, and tucked away.
The Department claims budgetary cuts are the reason, but more than a few analysts and research firms are questioning the timing of the closure. No doubt, politicians are always quick to deflect attention from any economic crisis, often blaming the negative coverage from the media for instigating problems — as if merely mentioning the words recession or credit crisis make them come to be. Who knows what the real reason for the cut off, but as our economic situation falls apart, the timing is suspect.
As for the Fed and M3, their claim was it was too expensive to calculate — never mind that M3 had been the mainstay money supply report during the last major recessionary inflation environment in the 1970s and early 1980s, when each week traders would huddle around awaiting the report. What’s happened since to M3? Fortunately there are still groups out there calculating it, such as John Williams’ econometrics firm SGS. (The were able to replicate with near exact precision the Fed’s original number, confirmed by several decades of back-testing.)
The results? If the Fed were expecting M3 to go through the roof, but wanted to hide it to keep inflationary expectations in line, the plan couldn’t have worked better. Below in a graph from SGS in red is the Fed’s M3 mixed with SGS’s duplication. In early 2006 the line goes blue as SGS takes over on its own.
