Economist Diane Coyle on the need for better indicators
of underlying economic conditions –
“… All these signs,
statistical or anecdotal, tend to be clearest when the economy is growing fast,
because they reflect spending that is sensitive to the state of the business
cycle. Economists working in governments and central banks need indicators that
give prompt warning of the trends, supplementing these with informal signs that
can act as early alarm signals. By the time official stats are available, the
last wave of specialty stores will have closed down — then it’s too late either
to cool the boom or to temper the recession quickly by adjusting interest rates
or using fiscal measures.”