MONEY & INVESTING

Reading the tea leaves. Those who are my age, or my senior, understand this expression. Some mystics used to swirl loose tea leaves in a cup and depending on their final position or configuration, the future would be told. And so the expression transitioned to mean portending the future based on current signals, events or indicators. Strange, but it does seem apropos to use that expression in the current economic environment.

Even in the financial world there are tea leaves. They are generally the economic indicators released by the U.S. Government, but not exclusively by Uncle Sam. The Conference Board produces some. Business groups produce other indicators. In all, there are a number of indicators that are released monthly or quarterly and, of course, annualized. The one best known is the report of gross domestic product, closely followed by the Consumer Confidence Index. And of course, most follow the stock market, which in its own right is a daily economic indicator. However, it is my belief that each day's gyrations are meaningless. Only quarterly reports have significance.

I have a particular fondness for these pesky numbers. While I was studying finance at NYU's Graduate School of Business, I worked part time for the economist at Lehman Brothers; that is, a previous version of Lehman Brothers that was so small, personal and reputable that it seemed to have no relation to the firm that grew and ultimately faced demise.

My job was to record — not by computer but by hand — all the economic indicators as they were reported, display them, comment on subsequent month's revisions, etc. It was not intellectually stimulating work but is was a J-O-B and I was grateful. Every once in awhile, someone important in the firm would actually look at my reams of hand-recorded numbers and have an " Aha!" and then, of course, leave me to my solitary world of statistics.

Some of the economic indicators are a "production." They have core, relevant data but because not all of the information has been reported or is known at the time, there is an extrapolation of the current month or quarter based on previous data, formulas and models. And each week, month or quarter, as applicable to the data, those numbers are revised upward or downward, some a lot, some little. So remember when you hear a report, that it might not be final and can turn out better or worse.

The many indicators are classified into three groups: leading, whose numbers move before an economic upturn or downturn; coincident, indicators that track along with the economy; and lagging indicators, which change in line with the economy months after the economy has changed direction. Respectively, examples of each are stock market indices, gross national product and unemployment.

And guess which indicators everyone wants to follow? You got it, the leading indicators. The ones that " tell the future." If you want to know about all the indicators, a good Web site that will answer all your questions is: www.investopedia. com/articles/economics/08/leadingeconomic indicators.asp. Did you know that Wall Street looks carefully at the National Purchasing Mangers Index? That rises in commodity prices lead a recovery?

The leading indicators that I most closely follow are:

. The stock market - leads the economy by about six months. So, as suggested by the March lows, the market is

saying that the economy will turn upward by about September.

. Consumer Confidence - reflects the attitudes and emotions of the U.S. consumer, the gorilla behind this economy accounting for more than 70 percent of the U.S. GDP. The reality is that any recovery requires restoration of trust and confidence in the consumer to end delayed purchases and resume normal investments.

For the average investor, I suggest following a few indicators — month to month and after you get more comfortable with them, then you can add more to your ticker list. The equity market absolutely does react to reports of these indicators. I am not suggesting that a close watch of these numbers will change your investment portfolio but it might give you a better understanding of the current economic state of affairs. And that could translate into better business decision-making, lifestyle planning and, when we see an upturn in most leading indicators, a better night's sleep.

— Jeannette Rohn Showalter is a Southwest Florida-based chartered financial analyst, considered to be the highest designation for investment professionals. She can be reached at jshowaltercfa@ yahoo.com