Snooze or Lose

It is time to get off the sidelines and into the game. The data coming out of the U.S. and foreign economies is looking better and better. For example, Wholesale Trade data through November is now available, and the report is good.

Durable Goods Wholesale Trade is up 12.3% year-over-year and Nondurable Goods Trade is up 15.9% year-over-year (annual data in both cases).

These numbers are holding up so well because the industrial base of our economy is more than making up for the lackluster performance of housing and nonresidential construction. You can see this by scanning the following breakdown of durable goods activity by segment.

Segment Year-over-Year Change
Machinery, Equipment and Supplies 19.7%
Metals and Minerals (excluding Petroleum) 19.0%
Motor Vehicles and MV Parts and Supplies 12.2%
Electrical and Electronic Goods 10.3%
Hardware, Plumbing, Heating Equip/Supplies 8.5%
Lumber and Other Construction Material 5.9%
Professional and Commercial Equip/Supplies 5.0%
Furniture and Home Furnishings 0.7%

The latest leading indicator input and our analysis of the rate-of-change and data trend probabilities says that each of these segments will continue to grow in 2012.

If you are watching the actual monthly data points, the slip in activity posted in September, October, and November is purely seasonal in nature. The cyclical movement underpinning the trend is strong. Longer-range leading indicator input from the bond market and our analysis of intermediate trend probabilities suggest that rise will continue through the first half of 2013 (if not longer).

Sitting on the sidelines waiting for even more good news will only shorten your time to prosper in this business cycle. There is nothing to stop you from being aggressive over the next 18 months except your own lack of resolve.