On the whole, the data this week are not favorable for the U.S. economy. Today’s GDP revision, which raised the growth rate to 5.9%, was all about inventories, which shrank by $16B less than in the advance report. As a result, final sales growth was only 1.9% rather than the 2.2% originally re- ported. Forecasters are crunching these numbers as I write, but I am sure that these data will lead to a reduction in estimated first quarter GDP. Most estimates had placed growth this quarter around 3.0%, but there is a wide divergence, and the weather in the East makes this quarter’s estimate even more difficult. But I wouldn’t be surprised to see new estimates in the 2% to 2.5% range.
... the four week[Employment] moving average is increasing and this does not bode well for employment this quarter...Bloomberg reports the current estimate of payroll change at a 50k loss, although I believe the loss could be much higher...
The shockingly bad consumer confidence number from the Conference Board on Tuesday was also discouraging.
Jeremy Siegel, 3/1
"I still believe that we will see job growth starting this month, and that the jobless rate will remain under 10%."
--- Jeremy Siegel, 2/12
"I see no reason why stocks will not return 6% to 7% per year after inflation over the next ten years. "
---Jeremy Siegel, 12.28
"If the S&P 500 Index could convincingly close above the 1100 level, I think we’re in for another good upward run"
--- Jeremy Siegel, 11.16 (S&P - 1106, 11/16/09; 1115, 3/1/10)