Have You Ever Heard of the Hemline Index?

When people talk about the economy and recession, they may not realize some say hemline length correlates directly with the state of the financial health of the country. The hemline index theory has been around since the 1920s and has remained a curious addition to American history. Those who have never heard of this theory need to learn more about it and whether it is viable.

How Do Hemlines Relate to the Economy?

George Taylor is the author of the hemline index which was developed in 1926. He believed he could accurately predict financial crises based on the length of hemlines. His theory states that women’s skirts and dresses get longer when the economy is bad and shorter when it is good. This interesting theory may not hold a lot of water, but it certainly makes for a fascinating conversation.

Hemline Index

What Do Economists Consider When Predicting Economy Crashes?

There are many clues that can give economists direction on how the economy will fare. The following are some of the factor’s economists consider when predicting recessions in the United States. Check out this page to learn more.

  1. Consumer spending begins to fall because of inflation.
  2. Personal income begins to fall directly because of inflation.
  3. Corporations begin reducing their expenditure.
  4. Industrial production begins to fall.
  5. Unemployment levels begin to steadily rise for weeks.
  6. The average duration of unemployment also coincides.
  7. Those who are interested in the subject of recession can read more here. With inflation at higher levels than in years past, many are concerned about the recession the United States seems to be heading for now.

Prepare Yourself for Recessions

Being recession-proof may seem difficult but it is not impossible. The following tips can help consumers prepare for recessions so they are less likely to cause negative impacts.

  1. Have a personal emergency fund
  2. Increase their income by finding a second source
  3. Spend wisely and within their means
  4. Avoid making large purchases
  5. Create a budget and stick with it
  6. Learn More Information

While recessions come and go, being prepared is critical. Taking the time to research past US recessions will help individuals learn what to look for when one is coming.

By following the tips above and putting them into action, individuals will improve their financial outlooks and prepare for the worst when it comes to economic recessions.

Waiting to prepare is not an option. Getting prepared now will give individuals peace of mind and allow them to feel less stressed when financial fears rise in the country.

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