In the early 1970's, a British TV show was imported to the United States ala American Idol and had a brief run on network TV. "That Was the Week That Was", I believe, launched David Frost's career in Britain. He later became one of the early Barbara Walters-type interviewers — without the tears — recently famous again for the movie the "Frost/Nixon" interviews. The show recapped the news of the week in a musical spoof format. It was one of the things that got me interested in the news. It used to be fun to recognize a story made into a semi-musical on Friday nights.
The above is my attempt to lead with an intriguing story line. Worthwhile or not, last week's news needs to be more closely examined for the predictive value some of the stories can give us.
The ISM Manufacturing Indexhas, over the years, proven to be one of the best predictive indicators for overall economic health. Even though there are far more jobs in the service sector as opposed to the manufacturing sector, this index has caught the last four recoveries in a very timely fashion. The 52.9 reading was the eighth sequential increase and the highest since June 2007. If it's the only number you had to go by, this would translate to an annual GDP of 3%, by my calculation. The flaw is that it covers the larger manufacturers that are more likely to be engaged in international trade. Smaller manufacturers are still caught up in the tight credit situation.