343 ordspråk av Ian Shepherdson

Ian Shepherdson

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 Every turning point has to start somewhere, and the evidence on the industrial sector is becoming overwhelming.

 Expectations are a leading indicator and are consistent with modest spending gains. Stronger stocks will push the index up further, and soon. This is a good report.

 Expectations had risen a bit too far, too fast, and were vulnerable to a correction; this is it.

 For now, claims signal strong payrolls and a lower unemployment rate.

 For the second straight week, jobless claims have substantially undershot the consensus, ... Analysts apparently do not want to accept that the flow of extra job losses caused by the events of Sept. 11 is slowing sharply, but that is exactly what the data indicate.

 Given the complete absence of meaningful inflationary pressure evident in the economy now, and -- as the Fed put it, 'tentative evidence of a slowing in certain interest-rate sensitive sectors of the economy' -- we think there is very little chance that rates will rise again in the current cycle.

 Given the extraordinarily weak chain store sales numbers [in September], this report comes as a huge relief -- it could have been much worse.

 Given the huge decline in consumer confidence, this (gain in spending) does not seem unreasonably weak, especially with consumers' real after-tax income growth slowing too.

 He used the word 'pre-emptive,' which was the signal he used before the March 1997 rate hike,

 He used the word 'pre-emptive,' which was the signal he used before the March 1997 rate hike.

 His assertion that 'a vigilant Fed [will] affect the necessary alignment of the growth of aggregate demand with the growth of potential aggregate supply' leaves little room for doubt as to where interest rates are headed.

 His conclusion, in essence, is that much of the productivity explosion of recent years is permanent, but there is a risk that there is significant cyclical element too. Unfortunately, this leaves us none the wiser as to his intentions at the next (Federal Open Market Committee) meeting.

 If claims remain anywhere near this week's level, they will send a very strong signal that the labor market is tightening.

 If claims remain at their current level, we could expect the unemployment rate to be down to 4 percent or so by mid-summer.

 If February is broadly similar, a March 28 rate hike is assured. The May meeting's risk is rising.


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