When we initiated the Obamanometer earlier this week, initial readings showed that economic trends favored President Obama, largely because of the jump in stock prices that followed news of the Federal Reserve's latest stimulus program. That advantage has now evaporated, mainly because stock prices have been flat for the last week and no other indicators buoyed the index.
Meanwhile, jobless claims and the Conference Board's index of leading economic indicators both came in fairly weak. And Moody's Analytics raised its risk of recession from 33 percent to 35 percent. That tips the Obamanometer slightly to Mitt Romney's side.
Obama has one thing going for him: Oil prices have been falling, which means gasoline prices will soon go in the same direction—as long as nothing blows up in the Middle East. I'll update the Obamanometer when changes in gas prices or any other indicators move the needle.
Rick Newman is the author of Rebounders: How Winners Pivot From Setback to Success. Follow him on Twitter: @rickjnewman
Methodology: The Obamanometer measures 22 economic metrics in 11 broad categories: the S&P 500 stock index, the price of gas, the unemployment rate, other job indicators, consumer confidence, leading economic indicators, inflation, housing, personal income, consumer spending, and the risk of recession as calculated by Moody's Analytics. The S&P 500 index and gas prices are updated daily, based on the level of change from one week prior. Other indicators are updated weekly or monthly as they come out. Changes are coded on a seven-point scale ranging from -3 to +3, with -3 representing a strongly negative economic development that favors Romney, and +3 indicating a strongly positive development that favors Obama. A score of 0 indicates no meaningful change. The individual scores are averaged each day on a weighted basis. The S&P 500 index, gas prices, and the unemployment rate are weighted to represent one-half of the index value, since those are the most highly visible economic indicators. The other metrics represent the other half of the index value. Each day's overall Obamanometer reading ranges somewhere between -3 and +3. In visual terms, an overall reading of -3 would be represented by the needle pointing all the way to the left, while +3 would be represented by the needle pointing all the way to the right. If the overall reading were 0, the needle would point straight up.