MARTOC Found Money
Index
Current commentary: As at Friday 3rd January 2014.
The recent period following the dramatic upturn in November has been characterised by high volatility and the lack of any clear direction. The improvement seen in November has not been sustained.
Monthly index December 2013 = 77.51 (previous month= 174.79)
Annual index for 2013= 83.24, showing an increase from 2012 which had an annual index of 73.69
Current weekly volatility = 55.88
Charts:
Long term:
2013- Monthly:-
Daily (December)
What is the MARTOC Found Money Index?
The MARTOC index represents the result of regular and consistent search on a weekly cycle over similar environments for dropped and abandoned money. It appears to be a leading index, being highly correlated with levels of confidence. Thus over the years found money has been counted, the impact of the financial crisis can be clearly seen.
The location covered is (normally) East of England, including Stowmarket, Bury St Edmunds and Sudbury. There is occasional migration across the UK.
The MARTOC index is collected updated daily, but the webpage will normally be updated once a week to provide the daily data. The back history continues from 1998; however during the first two years the collection techniques were being refined and cannot be taken to provide like-for-like data. While daily collection was made over the full series 1998-2013, only annual amounts are available for the earlier years (daily data was discarded). Monthly data is available for 2013. Daily data is available from December 2013 and will be recorded going forward.
The index is based on the average long-term rate over 10 years.
Rationale:
Why should the discarded coins and occasional notes scattered in our streets tell us anything about the state of our economy? Well, why shouldn’t they? When shoppers and consumers are relaxed and outgoing, they are more inclined to ignore small coins, to leave the occasional pound coin in the shopping trolley, or to drop a scattering of coins without picking them up. As the economic environment hardens, so the dropped money tails off. The sudden drop in the annual findings from the highs of 2006 to the lowest point (so far at least) in 2010 shows how closely the Found Money Index correlates to the financial environment. Within 2013, the sudden improvement in the second half of the year from September is followed by the sudden falling-off in December which reflects only too well the shop keepers’ reports that pre-Christmas shopping did not come up to their expectations. My own belief is that the Found Money Index forms a leading indicator.
There are some structural changes over the period:
· The period up to 2006 was primarily in the fens, covering Wisbech and Peterborough.
· From late 2006, the search area moved to Bury St Edmunds and Sudbury and Stowmarket.
· While the exact location may influence the daily levels (with a number of purely random influences) the general trend is reliable.
· The Index may be adjusted to include or exclude notes. A £10 or £20 note has an important place within the annual average – and at the annual level is sufficiently consistent to provide a meaningful contributor – but at the weekly or daily level it introduces significant noise. At present the Index includes notes.
· Inflation adjustment has not been included as yet.
· The volatility of the Index provides an interesting side-light. For most of the current month (December 2013) the volatility is very high– perhaps as high as it has ever been. Currently the monthly standard deviation is taken to provide the volatility index.
· One weakness which cannot be denied is that findings cannot be negative – the Index is floored at a daily zero rate.
· All found money is ultimately donated to a range of charities.
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