The market has us worried these days. We'd be dishonest not to admit that. Nonetheless, when we sit back and look at the economic data, we find it much easier to make a bullish case than a bearish one.
We've been straining our eyes, peering over the horizon, looking for signs of a real recession, but none are to be found. We can accept that the U.S. economy might get a recession in name only – a quarter or two of very mild slowing growth – but nothing worse than that.
There's just no hard evidence to support a serious downturn. And any evidence we can find is uniformly softer than a roll of Charmin – stuff like survey data, unemployment stats, and weakening consumer confidence (no doubt brought on by scary but exaggerated newspaper headlines).
Fortunately, as insecure as the average consumer claims to be, he hasn't cut back on spending in a meaningful way.
We're not just referring to recent retail sales, which is one of those soft figures based on surveys. Hard data from Wal-Mart, the biggest retailer of them all, strongly suggest that money is still moving through the tills at a brisk pace. Wal-Mart stock has racked up an 18% gain so far this year. And when the market cap of a $222 billion-dollar company rises 18%, that's real money – nearly $40 billion of it, in fact. Not something that would happen if retail sales were plummeting.Read more...
Bookmark/Search this post with:
