Baseline and Rate of Change (BaR) Analysis Grid^{©}  
The BaR Analysis Grid^{©} goes beyond simple trend analysis and offers several important dimensions to economic analysis.


The baseline represents a recession threshold for each economic indicator. The vertical axis shows whether the indicators are above or below the baseline. The horizontal axis specifies the rate of change, positive or negative. Recessions occur when most indicators have moved to the left side of the grid and many are near or below the baseline. 

Importantly, the baseline and rate of change values are calculated with fairly complex algorithms. For most indicators, threemonth exponential moving averages (EMA) are used. When a threemonth EMA is used, although an indicator may trend negative during one month, the threemonth EMA can remain positive, as it is weighted by the previous two months. In addition, the unique range for each indicator is used to calculate both the baseline and rate of change. For example, if an indicator has a range of change of 100%, and there was a monthly percent change of 30%, the rate of change would be 30 / 100 = 30%. If another indicator has a range of change of 10%, and there was a monthly percent change of 3%, the rate of change would also be 30%, as 3 / 10 = 30%. This gives each indicator a common base of 100 when mapped to the grid, resulting in proportional rates of change and percentages above and below the baseline. 