So, how do you keep a pulse of the economy? Either seek answers from the stock market, govt statistics and predictions from conventional economists or develop an uncanny ability to examine the sale of men’s underwear, Big Mac or the trend toward shorter or longer skirts. Yes, men’s underwear and women’s hemlines can actually predict movements in the stock market. In fact, sales of lipsticks, cardboard boxes, champagne and high heels can add to the list of these unusual economic indicators too.
Superstitious economists sometimes look beyond traditional macroeconomic gauges like GDP, CPI and PMI and choose these unconventional indicators to determine the health of an economy. What we buy explains why markets behave in a certain way, to a considerable extent. While they are in no way meant to replace comprehensive, technical and fundamental analysis, they may provide some interesting insights. In this module, we will discuss these weird economic indicators and understand if they are at all based on anything beyond coincidental correlations.