Sahm Rule
A real-time recession trigger based on unemployment deterioration.
Sahm Rule is at the 51th percentile since 1959, running close to the middle of its history.
0.1%
51th percentile • 0% of the way to its prior froth peak
Historical context
Red bands mark major stress windows.
What this metric is telling us now
The Sahm Rule tracks how far the unemployment rate has risen above its recent low. It is designed to flag recession risk once labor-market weakness becomes broad enough.
Why it matters
It is not a froth signal, but it keeps the bubble meter grounded in the real economy. A stretched market with rising recession risk is a different setup from a stretched market with sturdy employment.
Source and caveats
- Source: FRED SAHMREALTIME
- Update frequency: Monthly
- Last updated: Jun 1, 2026
- Composite contribution: Context only; not included in the composite.
- Caveats: The Sahm Rule is a recession trigger, not an equity signal. It usually confirms stress after unemployment has already begun moving.
Methodology note
Each metric is oriented so higher means frothier, converted to a percentile against its own history, and then averaged within its category before the category scores are averaged into the composite.
This site is for educational and informational purposes only. It is not investment advice, financial advice, tax advice, or a recommendation to buy, sell, or hold any security, asset, or strategy. The metrics, the composite bubble score, and any alerts are not forecasts and are not a signal to act. Markets can stay overvalued or undervalued for long periods, and past patterns do not guarantee future results. The data is aggregated from third-party sources, is provided "as is," and may contain errors, gaps, or delays. Do your own research and consult a licensed financial professional before making any financial decision.