Hi all, I should reiterate my warning to all you short term traders. We're headed into a downturn and the Sept to Oct period could be uglier than usual. I know many of you believe ECRI are just like all prognosticators, but I've never seen an org so accurate in their identification of turning points. Anyway, check out the article below. We might see $18-19 on Cisco again, if anyone's looking for an entry point.
globeinvestor.com
In a further sign of trouble, an index that foreshadows turning points in the U.S. economy suggests things will get worse before they get better. The Economic Cycle Research Institute's weekly leading index annualized growth rate fell to a 179-week low yesterday, its worst level in more than three years.
"The growth rate has been falling steadily since January," said Anirvan Banerji, director of research at the independent forecasting group, based in New York. "That suggests that as far as the eye can see, the U.S. economy will keep slowing, at least through early 2007."
Mr. Banerji said it is too early to tell if the index is pointing to an actual recession, but would not rule out that possibility. "We are certainly not seeing any indication of a revival in economic growth."
One impact of the housing slowdown is that job creation in the construction industry -- which has been soaring in recent years -- has gone into reverse, he said.
An end to the housing boom will pressure home prices, leaving Americans feeling poorer and curbing consumer spending. "Until a few months ago, home prices were rising and people felt as if they were worth more and assumed that they were okay spending money," Mr. Banerji said.
"That cushion has now disappeared." |
