My favorite economic analysis tools
These are my favorite economic analysis tools for tracking how the economy is doing and informing my investment strategy.
I could use your help. I know that not everyone likes to track what is going on in the economy and markets as I do. I imagine that is why people choose to read what I write. But, I also know that I have connections to a lot of smart people. So, today I am going to share the economic analysis tools I use in hopes that you will share a few other options that you use with me.
Sound like a deal? Cool.
Good ole FRED’s economic analysis tools
I spend a chunk of my time lately scouring through data on the Federal Reserve Economic Data (FRED) site. Because the site has a lot of economic analysis tools I’m going to call out the specific ones that I like to keep a more regular eye on.
- Their release calendar is the best place to discover what upcoming data is next up for release. For example, today at 7 am SOFR averages were released. By the way, SOFR rates are overnight borrowing costs between banks. Yes, banks borrow money just as they lend it out.
- The unemployment rate - boy, is the unemployment graph look crazy. Especially, when you see 2020 numbers due to the pandemic.
- Inflation - I have spent more time here in the past six months than I would normally. In a strong economy, I tend to not pay as much attention to what is going on with inflation.
- GDP - The Gross Domestic Product is a measurement of the value of all goods and services produced within the U.S. It is also important to note that other countries have their GDP measured.
- Housing starts - Who doesn’t love real estate, right? By keeping an eye on housing starts you can get a feel for how healthy the real estate market is and even what to expect in terms of appreciation for your own home.
Other economic analysis tools
FRED is by far where I get most of my data. But it isn’t where I spend most of my time. You might not think of it as an economic analysis tool, but on any given day I have CNBC running in the background. That allows me to keep up with how the markets are doing, on a broad scale, and other news.
I also use some other websites to track the economy.
- Fear Crypto or is it Crypto Fear? - The Crypto Fear & Greed Index is a fun one to watch. Right now it is showing “Extreme Fear”. I imagine a 50%+ decline across most cryptos is creating a lot of fear. What does this have to do with the economy? To me, it is another measure of consumer confidence, albeit a subset of consumers.
- More calendars - The FOMC meets every month. This meeting can have a huge impact on the markets, and the economy as a whole, if changes in the Fed Funds Rate are expected or not.
- MarketWatch’s Economic Calendar - I like their calendar because when they reference an upcoming announcement of data they also point out the most recent results.
- Top Stock Gainers and Losers - Finviz publishes a daily list of the top stock gainers and losers. Why should you care? First, that information is very helpful for active traders. Second, as far as the economy goes, watching for trends around which sectors and our industries are consistently in one category or another can help you understand where the economy is sputtering.
Hopefully, a few of the above resources are new to you. Let me know what economic analysis tools you like to use. I’d appreciate the tips.
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