We had unintentional inventory declines in the second and third quarters, which is what you would typically get in a recession. I think companies will need to build 50 billion per quarter in inventories, even if the demand growth rate is just 3.5 percent.
More Quotes from Steven Wieting:
This is not entirely comforting but you'd need a lot more information than one month's PPI at the turn of the year to worry about inflation,Steven Wieting
The Fed has assumed that the weakness in the first quarter was temporary. This confirms that. The reasonable view was you don't have a one-third rise in energy prices without consequences.
Steven Wieting
While the U.S. economy is still transitioning, and will for some time, data that should be supporting confidence in the recovery have not worked to ease investor concerns. We have to wonder if markets won't derail an otherwise quite healthy recovery in much of the core of the U.S. economy.
Steven Wieting
Seeing a two-year low in confidence in the wake of Hurricane Katrina isn't that surprising. The news in the month of September has been terrible. The television coverage and the emotional impact of the story has a big effect on confidence in the short run. But spending has been inconsistent with these confidence numbers.
Steven Wieting
It takes a lot of confidence to buy cars and homes people don't make that kind of decision on a whim.
Steven Wieting
Freeing up less productive resources by accomplishing more with less is the entire basis for rising living standards. It shouldn't come as a surprise that stronger periods of economic growth have generally begun during periods of high unemployment, not low unemployment.
Steven Wieting
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