In the United States, June 14th is Flag Day, initially proclaimed by President Woodrow Wilson in 1916 and officially enacted by congress in 1949 — 33 years and two World Wars later.

Newsweek jumped the gun on this year's Flag Day with their April 19 America's Back! issue, which explains "How America pulled itself back from the brink — and why it's destined to stay on top."

The Newsweek issue triggered some predictably bearish response, including comparisons to previous magazine-cover contrarian indicators, especially the Business Week Death of Equities, which predated the beginning of the most aggressive bull market in US history.

The April 19th Newsweek cover preceded the market's interim high by exactly one week. The major US indexes have since declined over 13%, although the two-day rally at the end of last week reduced the correction to a tad over 10%.

Of course the Newsweek cover article focused on the economy, not its manic-depressive cousin, the market. Still there are other indexes that lend credibility to the contrarian view of the Newsweek cover. The Economic Cycle Research Institute (ECRI) recently reported that their Weekly Leading Index (WLI) hit a 44-week low and descended into negative territory. This would seem to indicate dramatic slowing of the U.S. economy in the months ahead. Also worth noting is the relationship between the WLI change metric and the stock market.

Click for a larger image

The WLI data extends back to 1967. Here's a look back over the past 13 years for a sense of its performance with regard to the market peak in 2000 and bottom in late 2002. This longer view also illustrates the extreme behavior of the WLI in relation to the Financial Crisis.

Click for a larger image

The second indicator is a relative newcomer. It's the Consumer Metrics Institute 91-day 'Trailing Quarter' Daily Growth Index, shown in the chart below with an overlay of GDP.

The Consumer Metrics Institute hasn't been in operation long enough to have a historical record comparable to the ECRI, but the pattern in the overlay suggests that the Consumer Growth Index may give a clue as to the direction of GDP. If this indicator indeed has credibility, then a prospect of a double-dip recession, something that's happened only once since the Great Depression, cannot be easily dismissed.