came across this article and thought it might be of interest.

"Researchers at the Indiana University Kelley School of Business and the University of Missouri have devised a more accurate model to predict recessions and economic slowdowns, based on the aggregate probability of financial misreporting in the economy.

Like existing recession prediction models that rely on information from credit markets, monetary policy and inflation, the new model uses an estimate of the spread between long and short treasury rates. Unlike existing models, the researchers' model improves recession prediction by considering the aggregate probability of financial misreporting in the economy.

For 2023, their model predicts no recession, but it does predict a slowdown. While their recession forecast differs from the consensus forecast of professionals on a recent Wall Street Journal survey, it is in line with forecasts from Goldman Sachs and Morgan Stanley."

"Because our model improves recession prediction by about 25% over a simple model based on the spread between long and short Treasury yields, regulators should find it useful as they debate the likelihood of recessions," said Farber, associate professor of accounting at Kelley. "Another benefit of our model is that it improves recession prediction five to eight quarters ahead of its likely occurrence, giving regulators and business leaders more lead time to prepare for a recession."

phys.org - Recessions slowdowns based financial misreporting

all the best,

mike