Index of Leading Economic Indicators  The index for San Diego County that includes the components listed below (September)  Source: University of San Diego	- 0.3 %
	Building Permits  Residential units authorized by building permits in San Diego County (September)  Source: Construction Industry Research Board	- 1.04%
	Unemployment Insurance  Initial claims for unemployment insurance in San Diego County, inverted (September)  Source: Employment Development Department	- 1.36%
	Stock Prices  San Diego Stock Exchange Index (September)  Source: San Diego Daily Transcript	+ 0.42%
	Consumer Confidence  An index of consumer confidence in San Diego County (September)  Source: San Diego Union-Tribune	+ 0.09%
	Help Wanted Advertising  An index of print and online help wanted advertising in San Diego (September)  Source: Monster Worldwide, San Diego Union-Tribune	- 0.17%
	National Economy  Index of Leading Economic Indicators (September)  Source: The Conference Board	+ 0.28%

With September's decrease, the USD Index of Leading Economic Indicators has now fallen for six months in a row.  One positive development was that the number of advancing components to declining ones was even at three apiece.  This was the first time that the ratio had not been negative since the Index began its slide in the spring. As previously indicated in this space, job growth is expected to cool considerably in the year ahead.  Other areas that will feel the impact of this slowing will be the housing market, where prices and sales are expected to remain weak for most of the 2007, and in retail sales.

Highlights: Residential units authorized by building permits continued  to slide as homebuilders reacted to the weak housing market by reducing construction activity.  Residential units authorized through the end of the third  quarter of 2006 were down 32 percent compared to the same period in 2005.  Single-family units authorized bore the brunt of the decline, having dropped more than 40 percent compared to last year.  Multi-family units authorized were down a smaller but still significant 22 percent. . . The labor market variables remain weak.  Initial claims for unemployment insurance rose for the sixth straight month, albeit from historically low levels.  On the hiring side of the job market, help wanted advertising fell in September as online  advertising pulled back after a strong increase in August. The weakest sector for online advertising was food preparation and serving due to the ending of the summer tourism season. There is not enough data yet on online advertising to do seasonal adjustment at this point.  Despite the weakness in the labor market variables, the local unemployment rate fell below the 4 percent mark to finish at 3.9 percent for September. . .  Falling gas prices gave local consumer confidence a boost in September as prices fell below $3 a gallon for the first time in months. . . Local stock prices finally joined the rally in stocks that saw the Dow Jones Industrial  Average hitting new highs. This illustrates that much of the current stock market rally has been in the large capitalization companies represented by the Dow more than in the smaller capitalization stocks of the Nasdaq, where many San Diego companies are listed. . . The news on the national economy was mixed, with the national Index of Leading Economic Indicators edging up slightly in September.  At the same time, initial estimates showed that the Gross Domestic Product (GDP) grew at an anemic 1.6 percent rate in for the third quarter of 2006.

September’s increase puts the Index of Leading Economic Indicators for San Diego County at 141.0, down from August’s reading of 141.4.  There were no revisions in any of the previously reported data. The values for the Index of Leading Economic Indicators for San Diego County for the last year are given below: