Blog

30 Jul 2004

Posted at 16:13h in The Friday Brief by
The U.S. economy slowed to a 3% rate in the second quarter according to the government report just released.  The slower than expected growth was the result of rising energy prices and the weakest pace of consumer spending in three years.  Consumer spending which represents 70% of the economy increased only 1% after rising 4.1% during the first three months of the year.  The slowdown in GDP follows an upwardly revised 4.5% growth rate for the first quarter.  The bond market responded favorably to the news as the inflation pressures fall with slower growth.  

16 Jul 2004

Posted at 16:17h in The Friday Brief by
We are in the midst of earnings season once again.  This time, however, analysts’ projections may be catching up to the actual pace of company earnings being reported.  In more cases than in previous quarters, analysts have been a little too optimistic about the actual pace of growth.  But we should not lose sight of the fact that the actual rate of earnings growth is still quite good.

09 Jul 2004

Posted at 16:28h in The Friday Brief by
Perhaps the Fed has been correct in its view of the economic recovery and the patience they have demonstrated in raising rates.  Many have criticized their reluctance to raise rates faster feeling that it is important to achieve what they believe are market neutral rates sooner rather than later.  But maybe they have it right after all and have chosen the correct pace for rate hikes.  Too fast a pace might choke the recovery. 

02 Jul 2004

Posted at 16:30h in The Friday Brief by
One of the major economic trends we have discussed in earlier Briefs has been that of outsourcing.  I’m not referring to the politically-charged concept of ‘moving jobs overseas,’ but to the process whereby a business transfers to more efficient providers those functions over which it does not have particular expertise or are not mission critical.    

18 Jun 2004

Posted at 16:42h in The Friday Brief by
This week produced a huge number of economic reports, in part because some were delayed from last week’s day of national mourning.  For the most part, the reports showed substantial gains in both the momentum and the breadth of this economic expansion.  Not only is it real, it appears to have significant staying power.  Here are some of the highlights:

11 Jun 2004

Posted at 14:53h in The Friday Brief by
Hundreds of articles have appeared this week about the life and presidency of this charismatic and adored man, Ronald Reagan.  The one below reveals a unique and intimate view of the man’s character and his thoughtfulness.  It is reprinted with permission from its author Andrew Ferguson of Bloomberg News, in its entirety.

04 Jun 2004

Posted at 16:23h in The Friday Brief by
Before getting to the economics and financial happenings of the week I wanted to share a story with you. In the wake of Memorial Day and the dedication of the WWII Memorial it is timely in that it honors some of the unsung heroes of World War II. About a month ago my mother received a letter from a serviceman she met in Fayetteville, NC some 62 years earlier. He and his wife were traveling back to their Chicago home after spending the winter in Florida. He wanted to stop by to catch up and especially to say thanks for her contributions during a difficult time in his life and in the lives of so many servicemen.

28 May 2004

Posted at 16:26h in The Friday Brief by
Yesterday, the Commerce Department revised upward its estimate of how fast the economy grew in the first quarter of this year by two tenths of a percent.  The report also showed that corporate profits jumped 31.6% in the quarter ended March, the biggest increase since the first quarter of 1984. 

21 May 2004

Posted at 16:28h in The Friday Brief by
Peter Ustinov said “Beliefs are what divide people.  Doubt unites them.”  There are numerous periods in history to support the statement.  Most notably, the World Wars brought global division that united one side against the other.  Internal disagreements were put on hold.  Unity ruled until the ‘doubt’ of the future was replaced by victory. 

07 May 2004

Posted at 16:31h in The Friday Brief by
Maybe it’s impossible to fully prepare oneself for the prospect of leaving NeverLand.  We get comfortable with things as they are and are easily shaken when facing the possibility they may soon change.  We have known for months that interest rates couldn’t stay at forty-year lows and that tax breaks and incentives wouldn’t remain the rule.  But with all the waling and gnashing of teeth on Wall Street during the past few weeks, we see proof of Benjamin Graham’s observation that the market is a “voting machine” in the short run, driven by the sum of individuals voting their emotions of fear or greed.  Only during longer spans of time does it settle into its more dignified analytical reputation as a “weighing machine” of the facts.