hours before they took a more binding and permanent step of firing or hiring somebody. Another example would be building permits. You need a permit before you start construction. So it would be logical that the trend in new permits would lead something like construction employment or construction spending. So you need to have a logical correlation and then it needs to be proven across history and not just five years or 10 years, the longer, the better, obviously. So once we know the coincident trend or the momentum, we study the leading indicators to say, hey, is that momentum going to continue or are we nearing an inflection point where things are actually going to start, the momentum is going to change. And those inflection points are everything. All the money is really made or lost at these inflection points because the crowd is going one way. Everyone sort of extrapolates what's happening today into the future. Most economic models like what the Fed uses are really based on these (22/57)
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