The economy: not too hot...not too cold

Posted: Jun 7, 2013 11:54:40 AM

We have had a bevy of economic data this week which will support the Federal Reserve’s continuation of Quantitative easing programs. Here are the reports from this week:


The Good                                                                                                           

Auto sales which came out better than expected                          

The ISM services came in better than expected                             

The Fed beige book report showed the economy modestly or moderately growing


The Bad

The ISM manufacturing report came in below expectations

This morning's jobs report was better than expected but not a blockbuster report by any standard


Investors this week were focused on the Fed’s bond buying program coming to an end, but when all said and done, it looks like the fed will continue its buying program beyond investors expectations.  As of this morning, the liquidity driven market will continue.


Our perspective: the economy has definitely slowed, but not dramatically. The printing presses are on for now.  The best way to put the economic scenario into context is:  We are in a goldilocks scenario with the Fed and equity markets, but sometime soon, the bears will be coming home…but not yet.


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