V, Double dip (W) or L recession? Things look bad for the EURO is the skyscraper index is right. We have heard recently about problems in the Eurozone
Is the worst over or is the worst still to come? The skyscraper index
indicates: Trouble ahead.The Skyscraper Index is a concept put forward in January 1999 by Andrew Lawrence, research director at Dresdner Kleinwort Wasserstein, which showed that the world's tallest buildings have risen on the eve of economic downturns. Business cycles and skyscraper construction correlate in such a way that investment in skyscrapers peaks when cyclical growth is exhausted and the economy is ready for recession. Lawrence used skyscraper projects as a predictor of economic crisis, not boom.
* The first notable example was the Panic of 1907. Two record-breaking skyscrapers, the Singer Building and Metropolitan Life Insurance Company Tower, were launched in New York before the panic and completed in 1908 and 1909, respectively. Met Life remained the world's tallest building until 1913.
* Another string of supertall towers - 40 Wall Street, Chrysler Building, Empire State Building - was launched shortly before to the Wall Street Crash of 1929.
* The next record holders, World Trade Center towers and Sears Tower, opened up in 1973, during the 1973–1974 stock market crash and the 1973 oil crisis.
* The last example available to Lawrence, Petronas Twin Towers, opened up in the wake of the 1997 Asian Financial Crisis and held the world height record for five years.
Picture to visualize this.
The Dubai Tower
, the world largest building, opened 2010, during the major Dubai financial crisis
The European Central Bank Tower
will be finished in 2014. If the skyscraper index is a good indicator then the Euro zone should have it biggest problems around 2014.
Of cause the Austrians
like the indicator since it is in accordance with their business cycle theory.
You might want to enjoy some skyscraper pics
while it lasts (Skyscraper discussion board, you have to browse)