I subscribe to Brian Wesbury’s email alerts (you should, too); they’re summaries of key economic stats as they are announced, followed by Brian’s take regarding their implications. This week’s alerts were almost exclusively good news (...almost but not quite; there are still signs of inflation). But good news predominated. Here’s an example:
If there was a "soft patch," it wasn't all that soft, nor did it last for long. . . While March data was slightly weak on many fronts, the frenzy of apocalyptic warnings was completely unwarranted.
Here’s another example. I went out on a limb last week by suggesting that the BEA’s method of estimating GDP growth was too jerky, and that their estimate the previous week (3.1%) was too low. Consequently, I was not surprised by another of Brian’s good-news comments:
. . . our models forecasts first quarter real GDP will be revised to 3.9% from the preliminary 3.1%.
With good news predominating, the market can go nowhere but up. That, at least, was what I was thinking on Thursday. Then, Friday happened.
Investors abandoned blue chips and other large-cap stocks Friday as a lower-than-expected consumer confidence report fed into Wall Street's fears of an economic slowdown.
"Consumer confidence"? I thought consumer confidence was an effect, not a cause, of economic conditions. In any case, I’m chalking up Friday’s drop to Wall Street’s day-to-day neurosis. The overall economy is in good shape, and getting better.
