This is interesting...
A group of economists collaborate to create one master Financial Conditions Indicator which will be made up of 44 sub-indicators that are blended together. Kind of like The Precious.
What will go into The One True Indicator?
For example, the FCI will include the price of the Wilshire 5000 stock index, the interest rate spread between the 10 year T Note and the 3 month T Bill, the total quantity of all commercial paper outstanding and a Michigan credit availability survey or two. These 44 data points and readings will come together to give us one number by which to judge the entire financial picture.
I've only skimmed the paper itself (55 pages) but economists and policy wonks may want to really dive in, the downloadable PDF is below:
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