So far, layoffs have been bad, but the job market has held up pretty darn well. If companies really get the axe out more than they have, that sets a bad dynamic in motion. That's what's got to give Federal Reserve Chairman Alan Greenspan nightmares.
With profits in such a tailspin, I'm revising down my capital expenditure outlook for the next six to nine months, and (I see) almost zero job growth for rest of this year.
Growth took them by surprise last year so I think this is paying back for all that growth we had last year.
There's a difference between being stable and starting to grow again. I think that's what we're hearing from companies, too - the worst may be over, but we really don't see the upside coming, and that's what these jobless claims suggest.
I'm surprised we're seeing this little amount of weekly claims because we keep hearing the announcements. There have to be more layoffs in the pipeline.
I think we are heading into the worst of it. Investors think there we're heading towards a recovery in the next six months and I hope that they are right, but I just don't see the valuations for a huge rally going forward.
Volatility should be expected. At some point, really low inflation is bad for earnings. If you can't raise prices you can't bring in the earnings Wall Street wants.
There's no inflation threat out there.
The Fed's not worried about inflation, nor should they be.
I have never thought that what a government wants its currency to do makes a hill of difference. What's holding the dollar up is a desire to put money here and a faith in Greenspan and Corporate America. That's all psychology, and it can turn on a dime.
The price we have to pay for all this is someplace. Early in the century, we're going to see a real good old-fashioned panic of the kind we haven't seen in a long time.
We just don't see the wage pressures and I think the bond market is so happy because that means there really isn't any threat of inflation out there. Remember all those terrible surprises we used to get on Fridays It's about time the bond market got a good one.
The Fed has always said that they look at domestic considerations. We'll see today if they mean it. I don't really think they will raise rates, but if they do, it will cause tremendous market turmoil because no one in the market expects it.
People may not be feeling all that good, but they are trying to cheer themselves up. They're not constrained yet, but I do think it is going to set in. The bear market has taken a big, big bite out of wealth, and history tells us when that happens people do sort of cut back.
The rest of the world is not in good shape and exporting to them is a tough slog.
This is still very flat inflation. We do not have an inflationary worry.
We should see an upward revision to fourth-quarter GDP based on this trade number. But whatever it does to the GDP, it does not suggest that we're starting on a big roar of strength.
I am really concerned that one of these months we are going to get a bad inflation number. I think the markets have to be very nervous in front of these inflation numbers.
We're finding some footing, but the problem is, the job numbers are lagging. Even if we get economic growth, we're still going to see job losses. We're really at a very critical moment where we kind of have to start seeing a little bit of good news or the bad news starts piling up.
We're growing vigorously, and I think that the bond market is right to be a little bit concerned about this. It's not the data we've gotten, but the data we didn't get. We didn't get a slowdown in the second quarter. That, I think, is going to make the Fed very nervous.
This is kind of capping a string of fairly strong numbers, and I'm even going to have to boost my estimate of fourth quarter GDP up closer to 3 percent. We know the Fed is sitting on the edge of its seat. It's going to make everybody a bit nervous.
I thought the first six months of the year would be a white-knuckle ride. But monetary policy is as effective as ever. That money takes time to get in there, but I think it will stabilize things. We shouldn't expect anything to happen until July at earliest, though, and we'll have a few more months of holding our breath here.
Private sector credit from 1999 through the first half of 2001 was adding 1.2 trillion per year. It was the mother of all credit expansions.
Everybody uses energy, either to heat their homes or to drive their cars. So, when the price of energy falls, it's like the whole country gets a bonus or a tax cut.
Greenspan's testimony to Congress is always an event and probably more so this time than usual. We are looking at the Fed with a bias to tightening and we have to get some warning of whether he is going to act on that or not. So what I am looking for is a clear signal.
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