Manufacturing activity in the Philadelphia region continued to decline in January (for the 18th month of the last 20). The headline Philly Fed survey printed -10.6 (worse than the -6.5 expected) and apart from the insane outlier spike in August, this indicator screams recession…

More worrying is the fact that hope appears to be dwindling fast as the six-month-forecast for the survey plunged back into contraction (from +12.6 to -4.00)…

[This is the second indicator from the Fed of an economic storm on the horizon. The NY Fed business index also plunged dramatically in its latest report. Thus far we’re not seeing an issue in the labor market or in recent retail data, but it’s worth watching. — Ed]