Economic Intelligence
Macroeconomic models for navigating broad market cycles, federal policy, credit markets, and regime changes.
Our macroeconomic models analyze the broad economic forces that drive market cycles. From Federal Reserve policy changes to credit market conditions, these tools help you understand the macroeconomic backdrop influencing asset prices. Navigate regime changes, identify turning points in monetary policy, and adjust your strategy according to the broader economic environment.
Open-source macroeconomic tools for understanding market cycles.
Advanced forecasting model predicting Federal Reserve interest rate decisions based on macroeconomic data and policy frameworks.
View on TradingViewNational Financial Conditions Index tracking systemic financial stress across credit, leverage, and risk measures.
View on TradingViewComprehensive index synthesizing key US macroeconomic measures for economic cycle analysis and market timing.
View on TradingViewProxy reconstruction of Bloomberg Financial Conditions Index tracking liquidity, credit spreads, and market stress.
View on TradingViewStatistical analysis model of small business economic conditions and sentiment as leading economic signals.
View on TradingViewMonitor sovereign credit spreads across major economies to assess global credit risk and potential contagion in government bond markets.
View on TradingViewAnalyzes market microstructure dynamics including order flow imbalances, spread behavior, and liquidity patterns for institutional-level trade timing.
View on TradingViewAsset returns are shaped by the business cycle, which moves through expansion, peak, contraction, and trough. Each phase produces a different return profile across equities, fixed income, commodities, and cash. Investors who understand which phase the economy occupies can tilt allocations toward asset classes that historically perform well in that environment, rather than relying on static weights that ignore the economic backdrop entirely.
The Federal Reserve influences markets through the federal funds rate, forward guidance, and its balance sheet. Rate changes propagate from short-term interbank rates to Treasury yields, mortgage rates, corporate borrowing costs, and finally real economic activity. The lag between a rate decision and its measurable impact on GDP is typically 12 to 18 months. Tracking Fed policy means understanding the direction and magnitude of the policy stance relative to the neutral rate and what that implies for financial conditions over the coming quarters.
Financial conditions indices aggregate credit spreads, equity volatility, the yield curve, and the dollar into a single measure of how easy or tight conditions are. The Chicago Fed NFCI and Bloomberg FCI capture systemic stress that no single variables on its own. Tightening conditions tend to lead equity drawdowns by several months, making these indices useful as early warning systems. When conditions loosen from stressed levels, equities have historically produced above-average forward returns.
The 10-year minus 2-year Treasury spread is one of the most studied recession signals. An inverted yield curve has preceded every US recession since 1970, though the lead time varies between 6 and 24 months. The curve inverts because markets expect future rate cuts in response to a downturn while short-term rates remain elevated by current Fed policy. Its track record is strong enough that fixed-income and equity managers routinely monitor it as a core macro input.
Credit spreads reflect the market's real-time assessment of default risk and economic health. The high-yield spread widens sharply before and during recessions as investors demand more compensation for credit risk. The TED spread captures interbank lending stress and has historically spiked during financial crises. Monitoring these spreads together provides a layered view of how credit markets perceive risk at different points in the capital structure.
The NFIB Small Business Optimism Index captures hiring plans, capex intentions, and earnings expectations from firms employing roughly half the US private workforce. Small businesses are more sensitive to credit conditions and local demand than large corporations, so changes in their outlook often precede broader turning points. Consumer sentiment surveys add a complementary demand-side perspective. When both deteriorate simultaneously, it tends to confirm a genuine slowdown.
Sovereign credit spreads measure the yield differential between a country's government bonds and a benchmark such as German Bunds or US Treasuries. The European debt crisis of 2010 to 2012 showed how sovereign stress in peripheral economies can transmit rapidly to banking systems, corporate credit markets, and global equities. Monitoring spreads across major economies provides an early read on contagion events that models focused solely on US data would miss.
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