Beating the Business Cycle

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Summary: Gives economists a better name
Review: After getting sick and tired of all the hot air that economists spew, this book gave me some hope for the dismal science. Yes the authors discuss how their calls were correct, but I see this as a necessary part of the story being told, i.e., that through the prism of good leading indexes for growth, inflation and jobs, the wild a crazy path that the economy has taken over the past few years is understandable, and more importantly, not a surprise. I'm torn as I write this review as I might be better off as an investor if others did not read this book! Still, their advice on how to use the Weekly Leading Index to make better decisions is an important gift to society.

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Summary: Credit where credit is due
Review: All in all a very good read. Yes, I understand why some would want to know the "secret indicators" that ECRI uses, but I for one don't care. I just want them to keep making good calls on the economy's direction. Of course they don't give away their secrets (why would they?) but more importantly the book does show how to use their forecast to go against the masses at the right time. And, at least for those interested in economic history, the book tells a pretty good story of how things, including the forecasting industry, got to where it is today. This book is well worth the few hours it takes to read.

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Summary: Can't beat "beating the Business Cycle"
Review: Although I have not finished the book, I am finding it informatve, entertaining and an invaluable tool for understanding the ebb and flow of the economy. Lakhman Achutan and Anirvan Banerji have writen a book that enables those of us without an MBA to gain insight with practical, usable tools. Hearing some of the advice of the so called "financial experts", and seeing how off base they were, it seems as if they could benefit from reading the book as well.

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Summary: A Must Read
Review: Having just finished Lakshman Achuthan and Anirvan Banerji's "Beating the Business Cycle" I have come away informed on what business cycles are and why they are important from both a business and personal perspective. The style of the the book was easy to read and entertaining while it demystified a subject that has been left to the experts for far too long. I feel much more secure to make any future finanicial decisions. The charts and graphs were really helpful. I appreciated the depth of "Beating the Business Cycle" and its accessibility. It is a fine art to treat simple ideas deeply and deep ideas simply which is what this book has done.

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Summary: Infomercial for their web site
Review: I bought this book because of an article in the Wall Street Journal listing it as a summer reading pick by investment professionals. I agree with several of the other reviews that the book touts the authors' expertise in designing business cycle indexes. There is litte detailed explanation of their methods. The authors and their company may be good at predicting the turning points in the business cycle, but this book provides little detailed insight into that process. The book does allow you to receive a promotional three month free subscription to the "light" version of their their Recession-Recovery Watch weekly newsletter, which costs about $100 a year. I will continue to keep taps on their prediction performance.

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Summary: The Proof is in the Pudding
Review: I found "Beating the Business Cycle" to be readable, interesting, informative, and most importantly, eminently useful. If the reader can forgive the sometimes Madison Avenuesque nature of the book (i.e., the book at times sounds more like an ad for ECRI than a "how to" manual), he/she will find this book to be an excellent tool to help financial professionals and business managers navigate the often murky waters of business cycle forecasting.

As far as forgiveness is concerned, I direct the reader to p. 35, which states: "Unlike many research institutes, ECRI has no endowment and is not funded by any special-interest group. We cover our expenses by providing subscribers with access to our forecasts which are based on more than one hundred cyclical indexes covering over 85 percent of the world GDP." What this means is that unlike other economic think tanks, there is no university endowment, brokerage firm, political group, etc. underwriting their research. Therefore, in order for them to produce absolutely objective and meaningful reports, they must (1) obtain 100% of their funding from subscriber fees, and (2) strictly withhold from their clients (and the public vis-à-vis this book) the proprietary knowledge that supports their research. The logic behind this is simple and needs no further clarification.

As for the book itself, it does exactly what it purports to do: explain in non-technical language what ECRI is, what they do, and yes, how well they do it. Most importantly, they explain how their research can be useful to both the individual and business community.

The proof is in the pudding: ECRI began talking about the possibility of US economic weakening in mid-May earlier this year. They are vehement about it now, but the consensus has only begun to "see the light". Even the Feds stated only a few weeks ago, when they raised the Federal Funds rate by ¼ point, that the economy is poised to continue strong growth and we are only in a temporary "soft spot". So once again, ECRI is right on target and the consensus lags. (Read the book to see what I'm talking about!)

I recommend that individuals and financial professionals read the book carefully and sign up for their 3-month free trial subscription (at the end of the book). At the same time, follow closely the changes in the published economic indicators, listen carefully to the pundits on CNNFN and CNBC, read the Wall Street Journal, etc. If you're still in doubt, put the whole thing aside for several months, then go back and take another look.





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Summary: Must read for managers and individuals
Review: I just got the book and read it over the weekend. It doesn't tell you where to invest your money but instead describes how to better time decisions about your business and personal finances. This is also not just another book by "pundits" who simply talk a good game, but rather a clear presentation of ECRI indicators that you can watch on your own with out being an economist (including the leading home price index that has a great record of forcasting big swings in US real estate prices). As the book quotes the Bank of England as saying, "the proof is in the pudding."

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Summary: Valuable Book on Business Cycles without Economic Jargon
Review: I'm a professional investor, but my eyes still glaze over when economists try to explain the economy using all kinds of statistical terms. This book lays it out in clear English, perhaps because their approach is different than most forecasters. The discussion of the history of cycles, and of real-life experiences using their economic forecasts are compelling, but I liked the "Leading Indicators 101" section the best because it clearly outlined how the cycle works. Now when I hear an economist tell me the economy's going up because production or employment was good last month I know to take it with a grain of salt. I also found the discussion of the Leading Home Price Index valuable for my personal affairs.

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Summary: Keep Up the Good Work
Review: I've been watching out for these guys in the financial press for years and I'm glad they finally wrote a book. They have a tendancy to go against the grain at the right time. I wish I'd taken their views more seriously in 2001, but I won't make that mistake again. The book does not bog you down with statistics or economic terms, but it does clearly show how to monitor economic and inflation cycles. I do wish I could see more of what they give their big clients.

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Summary: It¿s About Time!
Review: I've heard of these guys on and off over the years, and after reading their book I finally feel that I have a framework for approaching the dismal science of economics that seems so inconsistent when I listen to the experts of TV or newspapers. I commend the ECRI researchers for staying the course over decades and not selling out to mainstream economics or Wall Street. It is very important to have a "reality check" like the Weekly Leading Index, and I was pleasantly surprised by the free subscription to their weekly report that comes with the book. Even better - the latest report shows that the Leading Home Price Index is holding up!