Eric Siu breaks down why restaurant data and railroad freight are better recession signals than traditional metrics. The Restaurant Performance Index sits at negative 0.1, and Warren Buffett watches railroad data closely because it reflects real consumer spending before official numbers catch up.
Do you know what RPI means? It's Restaurant Performance Index. So sure, you look at inflation data, you look at job reports data, but all that can be manipulated pretty easily by the government, right? But when you look at Restaurant Performance Index, you can see when there's weakness, like every time it drops below a certain amount, a recession happens, right? 'Cause that shows like how weak the consumer is. If they're not going out to eat that much, that means the consumer is backing off a little bit. And so it's actually -0.1 right now or something like that. So it's worth looking at that. And Warren Buffett likes looking at the railroad data, right? Like if you have more, less railroads kind of, you know, transferring stuff, that's also weakness in the economy. So I don't know how that looks right now, but it's worth taking a look at because who knows how we're doing right now.
