{"id":62286,"date":"2025-08-16T05:25:40","date_gmt":"2025-08-16T05:25:40","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=62286"},"modified":"2025-08-16T05:36:52","modified_gmt":"2025-08-16T05:36:52","slug":"us-leading-indicators-2","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2025\/08\/16\/us-leading-indicators-2\/","title":{"rendered":"US Leading Indicators"},"content":{"rendered":"
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\"Bull\/Bear<\/div>\n
\"Stock<\/div>\n<\/div>\n

The gauge on the left indicates bull or bear market status, and the one on the right reflects stock market drawdown risk.<\/p>\n

Bull\/Bear Market<\/h2>\n

The Bull\/Bear indicator remains at 40%, warning of a bear market ahead.<\/p>\n

\"Bull-Bear<\/p>\n

The Chicago Fed National Financial Conditions Index declined to -0.54, indicating easy monetary conditions are supporting stocks and bonds.<\/p>\n

\"Chicago<\/p>\n

However, the University of Michigan consumer survey of current economic conditions declined to a low of 60.9 in August, continuing a downtrend since mid-2024. Values below 100 indicate a bear market.<\/p>\n

\"University<\/p>\n

Stock Pricing<\/h2>\n

Stock pricing climbed to a new high of 97.94 percent, compared to a low of 95.04 percent in April and an earlier high of 97.79 percent in February. The extreme reading warns that stocks are at risk of a significant drawdown.<\/p>\n

\"Stock<\/p>\n

We use z-scores to measure each indicator’s current position relative to its history, with the result expressed in standard deviations from the mean. We then calculate an average for the five readings and convert that to a percentile. The higher that stock market pricing is relative to its historical mean, the greater the risk of a sharp drawdown.<\/p>\n

Robert Shiller’s CAPE compares the current S&P 500 index to a ten-year average of inflation-adjusted earnings. Outside the Dotcom bubble, the current CAPE value of 38.59 is the highest ever recorded in over a hundred years.<\/p>\n

\"Robert<\/p>\n

The forward price-earnings ratio for the S&P 500 increased to 24.9, more than a 50% premium compared to the long-term average of 16.1.<\/p>\n

\"S&P<\/p>\n

Conclusion<\/h2>\n

The bull-bear indicator at 40% warns of a bear market, while extreme pricing increases the risk of a significant drawdown.<\/p>\n

Acknowledgments<\/h4>\n