Jeff Gundlach's Favorite Recession Indicators Say Everything's Fine—For Now

Labor market trends are still strong, but there may be trouble come fall.

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By Luke Kawa

May 6, 2016 at 5:25 PM UTC

This article is for subscribers only.

Is job growth slowing because the economy is near the natural limit of full employment, or because there's a coming downturn? That's the key question being asked today after a jobs report showed non-farm U.S. payrolls rose by 160,000 last month, far below the 200,000 economists projected.

Perhaps in a case of macroeconomic time-travel, DoubleLine Capital LP Chief Executive Officer Jeffrey Gundlach answered that question yesterday. The answer is everything is fine, for now.

During an event held Thursday at the New York Historical Society, Gundlach discussed three of his favorite recession indicators. The first is when the annual change in America's index of leading economic indicators goes into negative territory: