Drones vs. kidneys: Google autofill on the economy

Published 12:00 am Monday, October 6, 2014

Sara Krulwich / The New York Times file photoJeremiah Johnson flies a drone inside the Barbarian Group offices in New York in July. If you were looking for a national collective conscience, Google’s autofill feature is a good place to start. The top autofill word after the phrase “I want to buy” in the fourth quarter of 2013 was “drone.”

If you were looking for a national collective conscience, you could do worse than to check out Google’s autofill feature — when Google’s search engine tries to guess what you’re looking for by “autofilling” a few letters of a query into a fully formed question.

Take a recent search for “Who Is?” The autofill suggests that Americans are very interested in the Islamic State, the brutal group of Sunni militants in Iraq and Syria, as well as reality TV show “The Bachelor.”

With the third quarter now behind us, Nicholas Colas, chief market strategist at ConvergEx Group, a New York broker-dealer, used autofill and other “off the grid” indicators, including Google Trends, to see how Americans feel about the economy.

“Every quarter we take a break from all the standard economic indicators to look at a range of alternative data,” he wrote in a note to clients. “The purpose here is to pose the question: Does the consensus view of the economy square with what real people do in their daily lives?”

Some conclusions from autofill: Don’t be surprised if Dad comes home with a new drone and one kidney.

Colas has been tracking Google autofill data for a while, and for most of the last three years the top three positions for completing the query, “I want to buy …” have been won by “a house,” “a car” and “stock.”

The fourth spot tends to vary with the news cycle, and in past quarters has included things like “a gun,” “a dog” and “Facebook stock.”

“Gun” has jumped around and in the past had the top spot, but hasn’t reached the top four in a year. Last year, the top spot in the fourth quarter went to “a drone”; in the second quarter, it was “something.”

Maybe that shouldn’t be surprising, given the number of drones in the news lately. Google announced a drone delivery effort dubbed Project Wing in the third quarter. The New York Times also reported on NASA’s efforts to create an air-traffic control system for drone aircraft.

And the prospect of drones landing in backyards and peering into bedroom windows has freaked a lot of people out. Speaking about drones in September, Supreme Court Justice Sonia Sotomayor told an Oklahoma City audience, “That type of technology has to stimulate us to think about what is it that we cherish in privacy and how far we want to protect it and from whom.”

One thing people do not seem to cherish are their kidneys; “kidney” was the third autofill option — after “car” and “house” — for the query “I want to sell my …” This could simply be morbid curiosity. In an interview, Colas said “hair” has also ranked high in past quarters.

“The point is not so much to develop an alternative paradigm of economic analysis as it is to poke and prod at the consensus we all embrace,” Colas wrote. “After all, can the U.S. economy be doing all that well if (I want to sell a) ‘Kidney’ is a common autofill?”

Looking beyond autofill to Google Trends data, Colas found that interest in gold coins, which hit at a post-financial-crisis low, suggests people are feeling much better about the nation’s financial system. But many Americans are still worried about money and food, as interest in food stamps ticked higher from earlier in the year.

Colas’ analysis included other oddball economic indicators like an inflation measure called the Bacon Cheeseburger Index (up about 6 percent), which measures how much it would cost to make a bacon cheeseburger at home.

He also looked at government data of how often people are quitting their jobs. The quits rate has become something of a mainstream indicator in the wake of the Great Recession. Quits are a good thing, since people don’t usually leave their jobs unless they have another gig lined up or at least feel confident they can find something.

All in all, alternative indicators point to an economy that continues to mend, but has mended so slowly that people still have severe anxieties about the future. That’s the same conclusion you would come to by looking at more traditional indicators like consumer confidence or the government’s monthly jobs report, which in September showed the unemployment rate falling below 6 percent for the first time since July 2008.

“But it feels like we got here by drone, with a different perspective of the same picture,” Colas concluded. “At least we didn’t have to sell our kidney to see it.”

Marketplace