Business Marketing

 

By Jim Hingst

Potato pancakes or latkes are not just for special occasions. They are also great as a breakfast side dish. During the Depression they were a popular and inexpensive meal. Here’s a recipe that my Polish grandmother would make for me when I was a young boy.

Ingredients

2 pounds russet potatoes (you can also use Yukon gold or baking potatoes)

NOTE: the reason that russet potatoes are used is that the moisture content is lower and the starch content is higher. Waxier potatoes with a higher moisture content will not fry up as crispy.

1 medium onion

1 grated carrot (optional)

2 large eggs, beaten

1 tsp. salt

freshly ground pepper

1/3 cup matzo meal (if you don’t have matzo meal you can substitute Panko bread crumbs or all-purpose flour)

1 teaspoon baking powder

Neutral vegetable oil or Crisco for frying

Directions

In making latkes you can use russet potatoes with or without the skins. If you peel the potatoes and put them in ice cold water. Grate the potatoes, carrot and onions using a box grater. If you decide to grate the potatoes with the skins on make sure that you thoroughly wash the outer surface of your spuds.

The skin of the potato is a great source of vitamins B and C as well as other essential nutrients such as calcium, phosphorus, manganese, copper and potassium. The skins also provide your diet with fiber.

In grating your potatoes, the grind or coarseness that you select is really a matter of personal preference. My grandmother preferred a finer grind. On the other hand, I prefer a coarser texture. For this reason, I use the coarse holes for the potatoes and the fine ones for the onion. Place the gratings in a bath of ice water as you are working to prevent the potatoes from oxidizing and turning brown. Soak the grated potatoes for ten minutes. See below.

When you are finished grating the potatoes and onion, transfer the mixture in a colander lined with cheesecloth. See the picture below.

Cover the grated mixture with another towel and allow the water to drain for a few minutes. Capture the drippings in a bowl underneath the colander.  Wrapping the potato mixture with the cheesecloth, squeeze out any remaining water as best you can. See the photo below. Excess moisture in your mixture will prevent the latkes from crisping up properly so this step is critical.

You should save the ice water from grating’s bath and capture the strained liquid. Allow the potato starch in the water to settle to the bottom of the bowl. Drain off the liquid leaving the collected starch. You can add the potato starch into your grating’s mixture. The starch will act as an adherent to bind the other ingredients together so your latkes don’t fall apart.

Mix the potato and onion with the matzo meal (or AP flour) and baking powder. The baking powder will help make the exterior of latke crispy while the interior will be fluffier. Add the beaten egg, and salt and pepper. The egg acts as a binder for the batter.  For a more fluid texture add an extra egg. For a stiffer texture or if the mixture is too runny, add some matzo meal or all-purpose flour to the batter. The desired consistency of the batter is a matter of personal preference.

In the frying pan heat the vegetable oil or Crisco (shortening) to 385⁰F. Crisco is great for frying and today’s formulation is free of trans fats so you don’t need to worry about your arteries clogging. Some traditionalists opt for using chicken or duck fat. Whatever you use, use enough oil or shortening to be deep enough to equal half the thickness of the pancake. Half an inch to an inch of oil should do the trick. 

If your mixture is firm, you can form the latkes into balls with your hands and then flatten them out with the back of a spatula. If the batter is more fluid, use a ¼ measuring cup to ladle out the mixture.

Fry until golden brown on both sides. It usually takes 3 to 4 minutes on each side to fry the pancakes. Allow sufficient spacing between pancakes when frying to prevent them from getting soggy. Keep in mind that each time you add patties to your pan the temperature of the oil will drop. This increases the time that the pancakes need to cook in which the interior of the will can become more saturated with oil.

To facilitate turning the latkes use a fish spatula.  The flexibility of this type of spatula makes flipping pancakes easier and makes splattering scalding hot oil less likely. If your latkes are small, you can also use tongs to flip them.

After your latkes are fried, you can place them on a platter lined with paper towels to soak up the excess oil. Better yet use a wire rack over a cookie sheet to facilitate the draining of oil.  See the photo below. Put the cookie sheet in an oven set at 200⁰F to keep the potato pancakes warm before serving. Serve the fried latkes with sour cream or applesauce or both.

If you have leftovers, you can store them in your fridge for a few days.  To reheat them, can refry the latkes in a frying pan with a little oil until the internal temperature of the pancake is 165⁰F. Reheating in a microwave however is not recommended. You can also reheat the latkes in the oven. Preheat your oven to 350⁰F. Place the leftover latkes on a cookie sheet and heat for 10 minutes. Flip the pancakes and reheat for another 10 minutes.

How the Conference Board’s Leading Economic Index (LEI)  accurately predicts recessions and recoveries in the U.S. economy.

By Jim Hingst

 Jim Hingst is a contributing writer for Sign Builder Illustrated magazine.

For more than 60 years the Conference Board’s Leading Economic Index (LEI) has accurately predicted recessions in the U.S. Does that mean that the index is bulletproof? Certainly not! But when someone is batting 1000, it’s hard to bet against them. In fact, economists are betting that there is a 70% chance that the U.S. will be in a recession within the next 12 months. Even if events do not occur within the predicted timeframe, it’s not if we will have a recession, but when as explained in the article “Surviving the Next Recession.” 

 

What is The Conference Board?

 

The Conference Board is an independent, non-profit think tank which has been forecasting the ups and downs of the U.S. economy since 1916. The composite LEI  helps economists, businesspeople and investors forecast future developments in the economy anywhere from 7 to 20 months in advance.

 

What accounts for the accuracy of the LEI is that it encompasses 10 key inputs both financial and nonfinancial. These economic indicators are a compilation of statistics from surveys of private businesses and government agencies.  The remarkable prescience of the LEI is especially significant now because it has been on a downward trend for the last 13 months as explained in “Weathering the Gathering Economic Storm.” 

The leading economic indicators in the LEI include:

 

Financial Inputs:

 

● Leading Credit Index. This index monitors the lending environment in the U.S. Favorable lending conditions indicate growth in the economy. When money is tight, the economy is in decline.

 

● S&P 500 Index of Stock Prices. The stock index appraises the value of the business sector and the financial health of stockholders. Average stock prices are generally a reliable leading indicator foreshadowing economic events in the near future. The question that many have is if the financial market is robust, how can the country be heading for a recession? A possible explanation is that overinflated prices for tech stocks are propping up the stock index.

 

● Interest Rate Spread. The “spread” measures the variance between short-term treasury rates and those for 10-year bonds. Read “Inversion of theYield Curve”. 

 

Non-Financial Inputs:

 

● ISM® (Institute for Supply Management) Index of New Orders. Based on a survey of purchasing and supply managers, this index factors in new orders; backorders; new export orders; imports; and inventories. An increase in purchasing activity indicates an expanding rather than contracting economy.  

 

● Average Consumer Expectations for Business Conditions. Consumer expectations reflect how the public views the outlook for the business environment, job security and prospects for income growth for the next 6 to 12 months. This leading economic indicator expresses how consumers believe the economy will affect their lives.

 

● New Home Building Permits. Higher material costs and climbing mortgage rates, which are now over 7%, have contributed to a decrease in building permits. This suggests a slowdown in the construction field. The ensuing ripple effect impacts sales of building materials and has a major effect on the overall economy.

 

● Average Weekly Manufacturing Hours. An increase in the weekly average of working hours for manufacturing suggests an increase in demand which will fuel production – a good sign for a growing economy. By contrast, manufacturing output declines in response to a drop in orders from retailers. It indicates that retailers are lowering inventories in anticipation for lower sales. Changes in manufacturing hours respond very quickly in response to changes in the health of the economy, which make it a key indicator to watch.

 

● New Manufacturers’ Orders for Non-Defense Capital Goods (excluding aircraft). Investments in capital goods, which includes buildings, equipment and machines, suggests that businesses plan to expand production capacity.

 

● New Manufacturers’ Orders for Consumer Goods & Materials. While orders for capital goods provide investors with a long-term view of the country’s economic future, new orders for consumer durable goods, such as appliances, furniture and vehicles, typically provide insight into short-term spending. Spending for either consumer durable goods or business durable goods indicates an upswing in the economy.

 

● Average Weekly Unemployment Claims. An increase in applications for unemployment foretells higher unemployment, lower consumer spending and a decrease in business activity. As a leading economic indicator, applications for unemployment do not show up in the unemployment rate for several weeks. By comparison, the unemployment rate is considered as a lagging indicator.

 

Conclusion.

Whether you are a financial analyst for a major corporation or the owner of a small shop, keeping a watchful eye on the Leading Economic Index is critical in guiding your business decisions.  Expect that inflation will continue unabated until 2025. As the Fed attempts to control inflation with additional rate hikes, interest rates will rise which will dampen consumer spending. When the LEI is on a downward trend, as it is now, you should prepare for a recession, which typically last for an average of 10 months. Key to survival is refocusing your sales efforts so revenues offset your shop and administrative expenses. Sales suggestions are covered in my article: “Sales Survival in an Anemic Economy.”

Read these other articles by Jim Hingst:

Harvesting More Leads from Social Media

Choosing a Business Structure

Funding Your Business

Pricing for Greater Profits

Dealing with Competition

Measuring the Success of Business Plans

Developing a Sales and Marketing Plan

Crafting Your Digital Marketing Message

 

© 2023 Jim Hingst, All Rights Reserved

 

By Jim Hingst 

 Jim Hingst is a contributing writer for Sign Builder Illustrated magazine.

An inversion of the yield curve  is one of the most reliable leading economic indicators for predicting recessions.

One reliable indicator of a recession is an inversion of the yield curve. The yield curve graphs the interest rates of U.S. treasuries at various maturity dates.

 

Normally the interest on a 4-week note is lower than that for a 10-year bond. When the yield curve is inverted, the interest rates for the shorter-term notes are higher than the longer-term treasuries. The inverted curve is also known as known as a negative yield curve.

 

When the yield curve arches upward, it generally indicates a positive sign for the economy. On the other hand, when the curve bends downward, it generally tells investors that the economy is contracting. This leading economic indicator has been inverted since late in 2022. That’s more than seven months ago!

 

If it’s so reliable, why aren’t we in a recession now? In the last 70+ years inversions in the yield curve can occur anywhere between 7 months and 20 months prior to a recession. That means that the recession could commence as late as June of 2024 – right before the next election.  

 

Of course, the current administration will likely do everything it can to delay the inevitable at least until after the election. While more government spending could artificially juice the economy, it unfortunately just adds fuel to the inflationary fires.

 

Economists often analyze what is called the “spread” between U.S. treasuries that mature at different times. While an inversion in the yield curve has reliably predicted every recession, the variance or spread between short-term rates and those for 10-year bonds is much more pronounced than in most previous recessions. In fact, the last time the spread has been this great was in the early 1980s. That recession occurred right after President Regan took office for the first time.

 

Another similarity with this period was the high rate of inflation. While inflation has abated some from the summer of 2022, it is still unacceptably high. For this reason, Jerome Powell has suggested that in the later half of 2023 you can expect two or three more rate hikes. Even then, he does not expect that the hikes will tame inflation until 2025. As the Fed increases its rates, banks will continue to increase their loan rates contributing to a slowdown in the economy.

Read these other articles by Jim Hingst:

Harvesting More Leads from Social Media

Choosing a Business Structure

Funding Your Business

Pricing for Greater Profits

Dealing with Competition

Measuring the Success of Business Plans

Developing a Sales and Marketing Plan

Crafting Your Digital Marketing Message

 

© 2023 Jim Hingst, All Rights Reserved