Economic Woes? Check Out The Underwear Aisles

Guys, if you want to know where the economy is headed next, look in your underwear drawer.

If you're like most men, you've got more than a few skivvies in, well, less than perfect condition. If you're put off buying replacements -- and your significant other hasn't done it for you -- then guess what? The recession probably ain't over yet. In fact, right now men's underwear sales suggest that things have bottomed but not started to recover.

Sure, this sounds trivial. But no less an economist than former Federal Reserve chief Alan Greenspan is a fan of men's underwear sales as an important economic indicator. It's one of several unusual indicators economists turn to in hard times. We went looking through them in a quest for the much-discussed "green shoots" of an imminent recovery.

Greenspan reasons that because hardly anyone actually sees a guy's undies, they're the first thing men stop buying when the economy tightens. (He told this to National Public Radio's Robert Krulwich years ago.)

Marshal Cohen, the chief industry analyst with NPD Group, which tracks consumer behavior, suggests that by extension, pent-up demand means underwear sales should be among the early risers when growth returns and consumers feel confident enough to shrug off "frugal fatigue," After a 12-month, 12% decline through the end of January, men's underpants sales leveled off during February and March, according to NPD. That suggests the economic was stabilizing.

For a recovery, we'd need to see a return to 2% to 3% annual growth in underwear sales. And that's not in the cards, believes Bill Patterson, an analyst at consumer research company Mintel. Based on market research and surveys, Mintel predicts a 2.3% decline this year in men's underwear sales and no recovery until 2013.

Folks such as Greenspan don't seem to look as closely at women's lingerie -- reasoning, perhaps, that women are more sensitive about wearing worn undergarments.

But Cohen says a pickup in sales of bras, as well as denim and footwear, will indicate the economy is on the mend.