The Trader's Guide to Key Economic Indicators

asked by titanium7 on November 21, 2006 10:28 AM

The volatile stock market is turning serious investors into macroeconomic-data junkies. Yet understanding just what the economic statistics mean, their place in the actual machinations of the economy and financial markets, and how to decipher the market's likely reactions to the latest pronouncements is a daunting challenge. Interpreting and applying effectively the complex cocktail of statistical data to investment decision making can be overwhelming. This book hones in on the dozen most important economic statistics observed on Wall Street today and points out the role that each plays in moving markets. It highlights the key interrelationships that each statistic possesses in and among the other economic indicators, and outlines their practical significance to investors. An extremely readable desk reference written from the combined perspective of a former trader, academic, and current Wall Street economist, "The Trader's Guide to Key Economic Indicatorswill lead readers through the mists of information, revealing what these important measures are and what they really mean.

Buy this book

[report to moderator]

Reviews

I found this book to be very readable and balanced from start to finish. Sure, some of the material became a little dry, but each chapter was readable in a single sitting. The excellent consistency between chapters with respect to the writing style and use of charts made the book well worth the time to read. The author has done a great job in pointing out what matters for each index he described. I wish all books on finances could be written with such clarity. This book is ideal for anyone who wants to learn more about spotting trends in the economy by learning the significance of the dozen economic indicators the author presents.

reviewed by nat on November 28, 2006 5:08 AM

[report to moderator]

This is a quality book without question. However, it provides too much factual descriptions about all the indices rather than important, key insights. I often had a hard time finishing every chapter completely. It often proves difficult (if not impossible) to get a hold of the data mentioned in the book without subscribing to a professional service like Bloomberg. 20% of this book gives 80% of the insight : I'd rather had seen the author explore that 20% in depth.

reviewed by webster on November 28, 2006 8:23 AM

[report to moderator]

This book was surprisingly easy to read and understand. Very interesting material for anyone curious about the factors that influence the economy and what measures to watch to understand where we are heading. Concentrates on the major indicators and tells you where the data comes from. Illustrated with lots of charts and tables to help you understand the relationships over time. Organized so that the information builds up to the more complex relationships. Though written by an economist, this book is surprisingly easy to read and the material was interesting (even for someone that slept through econ 101, like me). The most useful economics book I have run across. Highly recommended.

reviewed by jan1975 on November 28, 2006 11:17 AM

[report to moderator]

Even if you once knew all the ways that economic indicators are defined, data collected and reported, chances are that all of this has changed (unless your knowledge is less than 2 years old). In addition, the best way to use these indicators is constantly changing as new analytical tests are developed and back-checked. So if you are the chief economist for a Wall Street investment bank or brokerage firm, you probably don't need this book. But if you hold stock and bonds in the United States less often than 10 years, you can profit from this book.

Each chapter provides a delightful history of how a relevant indicator was developed, how the measurements are made now, how to apply the indicator for stock and bond investing and the latest technique for getting an "edge" on just looking at the indicator alone. The material is written in the kind of simple language that almost anyone can easily understand. The math is simple, too. If you can do arithmetic, you can understand this book.

There are individual chapters GDP; leading, lagging and coincident indicators; employment; industrial production and capacity utilization; indices from the Institute for Supply Management; manufacturers' shipments, inventories and orders; manufacturing, trade inventories and sales; new residential construction; consumer confidence and sentiment; advance monthly sale for retail trade and food services; personal income and outlays; and the consumer and producer price indices. Each discussion looks at how these data help you understand the future business cycle, interest rates, corporate profits and Federal Reserve actions.

I thought that the graphs were one of the best parts of the book. You can judge for yourself how powerful the relationships are that Mr. Yamarone outlines.

As I finished this book, I realized how nice it would be to have similar books for consumer decisions (like when to refinance your home, etc.) using the same kind of indicators in different ways.

reviewed by soulful on November 28, 2006 7:17 PM

[report to moderator]

add a new book!