Unlike the ECRI's Weekly Leading Index, the monthly Index of Leading Economic Indicators (LEI), compiled by the Conference Board, did not dip last year, though it did increase at a slower pace from June through October. Since then, it has been on a tear again with a gain of 1.0% during December, following November’s 1.1% increase. During both months, eight of the 10 components of the LEI rose. Such broad-based increases are good harbingers for economic growth during the first half of the year. By the way, the LEI is at a record high. It actually surpassed the previous record high during November 2009.
The Index of Leading Economic Indicators is a great 12-24 month leading indicator of federal tax receipts. It certainly would come as a big surprise to lots of New Normal prognosticators if federal, state, and local governments start to report improving tax revenues and record highs in these receipts by 2012. The 12 month sum of federal tax receipts through December rose 7.9% above the December 2009 total to the highest since May 2009. (We update these charts monthly for our subscribers in our "High Frequency Economic Indicators" and our "US Government Finance" briefing books.)