STOCK INDEXES IN COMMERCIAL TERMS AS A TOOL OF MACROECONOMIC ANALYSIS

Abstract

It is believed that stock indexes reflect the state of economic and financial system as a whole. However, nominal indices denominated in currencies, subject to inflation, making it difficult to assess them on the basis of the current macroeconomic situation.This article proposes a calculation procedure for commodity equivalents of the stock market indices. Corrections of RTSI and Dow Jones values during pre-crisis periods are offered. The interconnection between the official RTSI and Dow Jones values and its commodity equivalents is detected. It is also demonstrated, that the index rise during the recovery from crisis is inflationary in nature. The main conclusion is that the economic in Russian Federation has been in stagnation from 2010 until mid-2013.The method of converting stock market indices into commodity equivalents used in this research must by no means replace the existing nominal indices, but only complement them in order to facilitate a fuller examination of the macroeconomic situation. The method of converting indices into commodities enables us to evaluate the general state of the country economics on a higher level of accuracy and to predict where the situation is heading.