The sharp divergence in the 2001 recession between two key economic indicators-manufacturing production and goods output-could suggest that one indicator is flawed, casting doubt on the reliability of its overall series. This analysis finds no evidence of error. Rather, the strength of spending...

Remarks at the Dutchess County Regional Chamber of Commerce, Fishkill, New York.

Remarks at the State University of New York at New Paltz, New Paltz, New York.

Remarks at the State University of New York at New Paltz, New Paltz, New York.

Remarks at the Dutchess County Regional Chamber of Commerce, Fishkill, New York.

The purchasing managers' index is a widely watched but virtually untested indicator of manufacturing activity. This article examines how well the index lives up to its billing as a leading indicator. The author also explores whether the index supplies information about the economy beyond that...