1. Relation Between Consumer Confidence Index and other Macroeconomics indicators ------using RBF approach Sun Hao (hsun9@wisc.edu)hsun9@wisc.edu Course: ECE539(2008~fall) Instructor: Pro.Yu Hen Hu

2. Background ICS: The Index of Consumer Sentiment (ICS) is a consumer confidence index published monthly by the university of Michigan. Developed from national telephone interview Other index CPI: consumer price index; UI: Initial claims for unemployment insurance; DJI: Dow Jones Industrial Average Index;

3. Structure Input RBN output ICS (Next.) 2-LayerCPIUIDJIICS

4. Data Preprocessing Get data from website of federal reserve Monthly data of: CPI, UI claim, DJI, ICS Data range: Jan. 2005 to Oct. 2008 Calculate the monthly change of these data

5. Construct model Try different combination of input data. Try monthly income, S&P 500, unemployment rate Finally choose, CPI 1 st,2nd change, UI,DJI, ICS Try different configuration of network Different spread of the radio basic function Try MLP with back-propagation training Compare with multivariable linear regression Finally choose RBN

6. Training result

7. Testing Result Notes: 1.MSE: RBF: 67.54 MVLR: 69.22 2.Both of them can partly approximate the target curve 3.RBF perform slightly better.

8. Remaining Work Future job: Improve the network and try other feather vector Measure the effect of each input on the output.