When Economists Get Crazy: 3 Economic Indicators You’ve Never Heard Of

Economics is a complex social science — it studies the ins and outs of decisions, money, production, and much more. But just because it’s complex, doesn’t mean it can’t be fun.

What is an Economic Indicator?

Economists like to ponder over the future of a lot of things, but frequently, they ponder over the future of the economy. Economists tear through headlines, stock market data, investor sentiment, and many other sources of data to come to their own conclusion about the future. This data can be an economic indicator, meaning that they can be used to analyze the strength of the overall economy, and hence, reflect investment opportunities.

Wacky Economic Indicators

Now that we know what an economic indicator is, and what it can be used for, let’s get into the fun stuff.

The Haircut Index

Haircuts are somewhat of an oddity in 2020, and John Paul Dejoria, the founder of Paul Mitchell, would tell you one thing: we are in a bad economic situation right now. He’s not wrong, but what was his reasoning?

Mr. Dejoria claimed that the frequency of when people get haircuts is indicative of the economic performance. The more frequently customers get their haircuts, the better the economy is performing, and the less frequently, the worse the economy is performing. So, the next time you see your barbershop a little empty, that might be a sign of something.

The Men’s Underwear Index

Former US Federal Reserve Chairman Alan Greenspan loved it — it’s the legendary Men’s Underwear Index. This index asserts that men consider their underwear a necessity, not a luxury. What this means is that sales for men’s underwear will remain constant unless there is economic trouble brewing, in which case, they will be declining.

The Dry-Cleaning Index

Our final indicator is the dry-cleaning index, which is quite simple. It states that during harsh economic conditions, people will stop taking their clothes to the cleaners unless they have enough money to spare, or really need that white shirt cleaned. This indicator was so unique that Mr. Greenspan was also quite fond of it!

Funny Economics Jokes, or Great Crystal Ball?

While they may seem unconventional and a bit out of the ordinary, these economic indicators are based on economic principles and patterns which some have noticed. Regardless of how outrageous they may seem, some trust these indicators, so maybe next time you’re thinking of investing, look around for some unique economic data.