Berney, I believe that the 7.5% increase is in tax receipt from payrolls, not the quarterly advances, if these numbers are correct, it seems that in January's payrolls themselves were advancing YOY at a clip of abut 3% to 5% (yes taxes increase faster than payrolls themselves <g>, as if we did not know that <VBG>). As for the surplus, it really depends if we are going to run into an actual period of economic contraction. Right now, we seems to be headed, this time, once more, for a soft landing in the economy. If consumer confidence deteriorate further, things may change. When prices are increasing rather than decreasing in the automotive sector, things cannot be so bad. I heard from a GM dealer that the decision to discontinue the "Olds" brand has created huge demand for this last generation from "old faithful". Maybe that brisk demand in that sector is masking other basic weaknesses. There surely is over capacity in that sector, and normal laws of economics would dictate price declines rather than ascent under such circumstances.
Zeev |
