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Where Stands the Cup, Half Full or Half Empty

April 27, 2012 – 5:13 pm

First quarter GDP numbers out this morning were a disappointment. We had 2.2% growth in the first quarter, and growth is much better than the alternative but the expectation was for 2.7% growth. As I have said many times the experts are always wrong when they make their projections. There was a little bright light in that the consumer spending portion of the report was up 2.9% and since our economy is 70% or so consumer driven it tells us maybe the consumer is feeling a little more confident. Then again we had unseasonably warm weather back East and in the Midwest which may have brought out the shoppers.

Like all economic factors it is never clear cut. This week was not an exception with much stronger pending homes sales and much weaker durable goods sales. For us, the people that make up our society, what does it mean? Are we gathering strength or is it a false sense of tepid improvement? Many believe it is the latter and that belief alone adds to the softness of our economy. If people have no faith they tend to hoard their cash and that slows economic activity.

I think we need to expect more of the same: slow growth, a weak economy and a poor job market. Still, we are growing; the economy is expanding and the job market has improved. Is the cup half full or half empty? I am in the half full camp.

Now if we only can get Europe to stop dragging down the world economy.

Good Trading
Steve Peasley

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