Moody's Aaa/Baa, Unemployed, GDP, Dow Jones ...

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... Utilities Over Trans., S&P, and “Spiky”

Having only a chimerical clue to what –  if anything – these charts might be saying to a seasoned trader or (un)ideologically compromised economist, it's still easy to vouch for their intriguing nature. The “Spiky” orange line recalls a “Treasury spreads' ratio” for the differences between 30-year and 2-year to 10-year and 2-year bills.



Top Down (Visually)

The the gray diamond-flagged line denotes the ratio of Moody's Seasoned Corporate Bond Yields, Aaa to Baa and has been shifted up by ¼ unit to the left-hand scale. (The right-hand logarithmic scale applies to all Dow Jones and S&P indices for lines 3-7 in the legend below.) Unemployment is shown in white and it's percent change from a year ago is divided by 150 and shifted up by ¾, again scaled to the left. GDP (1 Decimal) is in deep red and marked with circles. Its percent change from a year ago is divided by 10. “Spiky” and the five stock market averages are followed by the green “diamond-backed” line showing the ratio of the Dow Jones Utilities to Transportation indices amplified four times and shifted down one unit along the left-hand scale.

All the “ƒ(x)” transformations are without numeric meaning other than to improve the visual effect of the chart. The underlying chart covers the period from 1980 forward and can be modified with this link. A view from 1947 is here.

	Series		Moody ... unemp gdp dj(icu/t)  S&P Spiky	(Scale) Size		Period	ƒ(x)
1	GDP		Gross Domestic Product, 1 Decimal	3	Solid	Q	%ΔfYA / 10
2	UNEMPLOY		Unemployed	1	Solid	M	(%ΔfYA/150)+0.75
3	DJIA		Dow Jones Industrial AVG	4	Dashed	M	Index
4	DJCA		Dow Jones Composite AVG	4	Dashed	M	Index
5	DJTA		Dow Jones Transportation AVG	4	Dashed	M	Index
6	DJUA		Dow Jones Utility AVG	4	Dashed	M	Index
7	SP500		S&P 500 Index	2	Solid	M	Index
8	DJUA / DJTA		DJ Utilities / Transportation	1	Solid	Q	( x * 4 ) - 1
9	DAAA / DBAA		Moody's  Corp. Bond Yields: Aaa / Baa	1	Solid	Q	x + 0.25
10	(DGS30-DGS2) / (DGS10-DGS2)		T Spread Ratio: 30s less 2s over 10s less 2s	1	Solid	D	x / 50