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The CMI Growth Index, the Market and Fed Intervention

May 25, 2011

Posted Image My recent update on the Consumer Metrics Institute Growth Index prompted a thoughtful response from James H. Ross, R.A. in Wilmington, NC.

With regard to your question of whether the CMI Growth Index is a leading indicator for the S&P 500, I have a definite opinion. The index dance along its 200-day moving average late last summer and into early fall validated the CMI index as a leading indicator in a normal functioning market — as long as one understands that the current equity market is not a normal market but is one that is heavily subsidized by the Federal Reserve.


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