Good news: Sales of men’s underwear are up so far this year. Better news? That may mean the economy in general has turned the corner.

This story first appeared in the August 24, 2009 issue of WWD. Subscribe Today.

That is, if Alan Greenspan’s theory is correct. The economist and former chairman of the Federal Reserve Board famously kept tabs on sales of men’s undergarments, which he believed could accurately predict swings in consumer spending.

Unlike coats or sportswear, underwear sales tend to be unmoved by the vagaries of trends or seasonal spending. Greenspan, who articulated his theory of “briefonomics” more than 15 years ago to then-CBS reporter Robert Krulwich, saw in this stability a winning economic indicator.

“On those few occasions where [sales] dip, that means that men are so pinched that they are deciding not to replace underpants,” Krulwich recalled of Greenspan’s thinking during a segment on NPR. For the economist, “that is almost always a prescient, forward impression that ‘here comes trouble.’”

Or growth.

According to The NPD Group, sales of men’s underpants are up 4.7 percent for the first half of the year, even as the men’s wear business overall continues to stagnate, falling 5.2 percent during the same period.

Which raises the questions: Do strong underwear sales suggest men have resumed buying basics after months of letting their skivvies get threadbare? Does a boost in that category predict future resilience in apparel overall?

“Underwear does follow a consistent pattern,” said Marshal Cohen, chief analyst for NPD, who is a firm believer in the category’s predictive powers. “As a pure commodity, its sales figures can reflect general sentiments about consumer confidence. To me, these strong figures mean we are nearing the end of the recession, and that it is not going to be as long or as deep as some feared.”

Cohen said that after a 12-month, double-digit decline through the end of January, men’s underwear sales leveled off and then began to pick up, suggesting the economy was stabilizing.

But even if underwear is an economic groundhog, the rest of apparel has a way to go before it will enjoy comparative gains. For the same six-month period, sales of tops tumbled 8.8 percent; tailored clothing dipped 5.2 percent. Apparel accessories slumped 4.4 percent. Only sleepwear and fleecewear posted gains, surging 11.7 and 14.4 percent, respectively. So much for the interview suit.

Cohen expects the rest of men’s wear will catch up to underwear’s lead — some in as soon as three months. “Bottoms will be next,” he predicted. “Guys can only go through a two-year cycle before their pants start to wear out. There’s a lot of pent-up demand for bottoms.”

Underwear makers and retailers aren’t surprised to hear their classification is the Magic 8 Ball of the apparel industry.

“Underwear is easy to buy — it’s a quick way to boost the ego and feel good about yourself while not spending a lot of money,” said Jason Scarlatti, creative director for fashion underwear brand 2(x)ist. “If you have a little cash to spend, guys will want to use it for a fresh pair of undies.”

NPD’s figures were echoed at, the leading e-tailer of men’s underwear. Sales of men’s boxers and briefs flattened out last fall but started to grow again after the New Year, gaining momentum in recent months. So far, sales for the men’s division are up in the low double digits; women’s product sold on the site is up in the single digits.

“If Greenspan is right, then we should be prepared for a strong recovery,” said Freshpair’s president, Michael Kleinmann. “You need underwear. It’s not something you can go without for long. Once you start buying again, it will be one of the first things guys will need.”

It should be noted Greenspan’s reputation as an economic soothsayer has been dimmed by the black clouds of the global recession — a storm, many observers have said, he should have seen coming. But in a market that has been besieged by bad news and gloomy predictions, any sunny forecast, even one that hails from the underwear drawer, is a welcome one.

“We’d like to think this is the beginning of a turn for not just underwear brands, but everyone,” said Scarlatti. “Maybe underwear sales do trickle down.”