The Economy is Cratering

A couple of months ago, I analyzed the data from the Phillie Fed survey, which showed the fastest 3 month deterioration in the index since it began in 1968.  After a small bounce last month, the wheels have completely come off.  Expectations were for a reading of +2, signifying slight growth (more like a mild swelling), but it came in at -30.7!  That signifies a deep recession as those are the levels it was at in the November 2008-March 2009 period.  The future expectations index, which is generally more positive (as people are generally positive) came in at a paltry 1.4, the lowest since November 2008.  As you can see from the chart below, things just aren't pretty:

Even worse is that every indicator, prices received, new orders, employment were very negative, except one, prices paid (though it's on a downtrend).  Given the negative PPI data yesterday, the negative CPI data today and then this data, stagflation could be on the horizon (though I'm of the opinion that will turn into deflation over time, unless the Fed starts printing again, then it will be stagflation for an extended period).

Update:  So I looked at the historical data more closely.  Every reading of the Philly Fed survey of this magnitude has either meant we were in a recession or heading into one within 6 months.  I also looked to see at what reading point does it look like there is a significant chance of us either being in a recession or heading into one.  It looks that with a reading of -11.8 or worse there is an 89% chance of us being in a recession or heading into one.  If you take into account the 3 readings that were within 3 months of the end of the previous recession, the odds go up to 93%.  Again, note the reading is at -30.7, a level at which there was never a false reading.