After personally suffering the costly effects of ECRI’s notoriously ill-advised recession call in 2012, I embarked on the journey to create my own recession models. Since developing the initial models in late 2012, I have published the model forecasts shortly after the end of each month. As I learned more about the art of forecasting recessions (and market peaks and troughs), I have incorporated a few improvements to the models.
The structure of the models makes it very easy to incorporate new explanatory variables, so I am always on the lookout for new data series that are causally related to recessionary environments. I recently discovered two new data series, which will be incorporated into the Trader Edge recession models going forward.