Up till now, our Obamanometer has wiggled between Obama and Romney territory, with every small pickup in the economy being quickly offset by a downturn elsewhere. But over the last week, the Obamanometer has moved firmly to Obama's side, and it now registers the highest reading since we rolled out the gauge in mid-September.
Gas prices are finally going Obama's way, falling by $.09 per-gallon to an average of $3.71, according to AAA. The stock market has picked up, with a two percent gain over the last five trading days (although investors remain skittish on account of the "fiscal cliff" and other problems).
Most housing indicators are turning positive, and the Conference Board's index of leading indicators came in strong recently, suggesting the economy will pick up steam over the next several weeks. Consumer confidence continues to improve, and Moody's Analytics recently lowered its estimated risk of recession from 35 percent to 30 percent.
Inflation numbers are still relatively high, thanks to the recent spike in energy and food prices. Those should moderate in coming months, but for now, inflation is working against Obama. And job news remains sporadic, reflected in an elevated level of jobless claims in the latest report.
Obama's challenge, obviously, is to convince a critical mass of voters that the economy, while weak, is consistently improving. But Romney must persuade voters that the economy still stinks, without coming off as too much of a downer. The latest numbers suggest that Obama's job is getting a little easier, and Romney's a little tougher. But a sudden drop in the stock market or some other negative surprise could quickly even out those odds.
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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 employment situation, 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 employment situation 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.