Just like a battered train engine wakes up to its life, economy is slowly gaining steam. If history is any guide, the economy will pick up the speed very fast before you even notice it. Ok, that’s a wishful thinking, I know.

The fact is that there are signs of life in the dark world of stock investors. There may be, just may be, light at the end of the tunnel. For the first time in the last 19 months, an index based on a survey of U.S. manufacturing purchasing managers crossed a threshold indicating factory output grew. Institute for Supply Management’s index of purchasing-manager sentiment rose to 52.9 in August from 48.9 in July, crossing the 50 mark that indicates the sector is expanding.

Good news is that manufacturing activity in China, France and Australia, among other countries, also expanded in August. “We had been looking for improvement, but the speed at which it’s come and the magnitude with which it has come is surprising,” said J.P. Morgan economist Bruce Kasman. Well, the surprise is good as long as it’s a pleasant surprise!

Related Link: Global economy gains steam

Here is some good news for Happy Friday! Economic Cycle Research Institute (ECRI) said its Weekly Leading Index’s annualized growth rate soared to a 38-year high of 19.6 percent from a downwardly revised 17.4 percent the prior week, a number which was originally 17.5 percent.

ECRI has good reputation in predicting economic cycle. ECRI’s Weekly Leading Index is a composite index key USA weekly economic series. The limited availability of weekly data constrains the number of variables in the composite index, but this has not hurt the WLI’s predictive power. The weekly frequency of the WLI makes it a very timely gauge of the economy’s direction.

“With Weekly Leading Index growth continuing to surge through late summer, a double dip back into recession in the fourth quarter is simply out of the question,” said ECRI Managing Director Lakshman Achuthan, reinstating the group’s recent warning to ignore negative analyst projections. It appears that Obama team’s policies and strategies are working!

Related Link: No double-dip recession