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Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: pater tenebrarum who wrote (100461)	5/8/2001 9:25:34 AM
From: UnBelievable	Read Replies (2) \| Respond to of 436258

Must Be Why The Futures Are Rocking <gg> Be sure to read last sentence. I'm confident that things are better now. US 1Q Productivity Dn For First Time In 6 Yrs ======================================================= First-Quarter Productivity !Surprise: Yes! Key Numbers: 1Q 4Q 3Q !Trend: May be! Nonfarm Productivity -0.1% +2.2% +3.0% !Inflationary ! Unit Labor Costs +5.2% +4.3% +3.2% !Consensus: ! Hourly Compensation +5.2% +6.6% +6.2% !+1.0% ! ======================================================= By Joseph Rebello Of DOW JONES NEWSWIRES WASHINGTON (Dow Jones)--The productivity of U.S. workers declined during the first three months of 2001 for the first time in six years, highlighting the growing toll the U.S. economic slowdown is taking on the country's work force. Non-farm business productivity declined unexpectedly by 0.1% from January through March, the Labor Department said Tuesday. The slump mostly reflected the slowdown in economic growth: As business conditions weakened, analysts said, many employers had more workers on their payrolls than they needed. But that raised employers' labor costs to a four-year high. The numbers surprised Wall Street, which expected productivity to increase 1%. The news is likely to bolster investors' expectations that the Federal Reserve will cut its key short-term interest rate by at least half a percentage point next week to stave off a recession. A productivity slowdown or decline normally heightens the risk of inflation. Because workers produce fewer goods per hour, they are less of a bargain to employers, who tend to pass on the higher costs to consumers. In the first quarter, for example, unit labor cost grew 5.2%, the fastest rate since the fourth quarter of 1997. During the 12 months through March, unit labor costs grew 3.1%. The Fed, however, has expressed no worry recently about the likelihood of an inflationary outbreak. Amid signs the economic slowdown is throwing growing numbers of Americans out of work, analysts say the Fed is too preoccupied with the prospect of a near-term recession to worry about inflation or the long-term implications of a productivity slump. Futures contracts show investors expect the Fed's key federal funds rate to drop to 3.75% by June. The Labor Department said the first-quarter productivity decline coincided with an increase in the number of hours worked by employees of non-farm businesses. Those hours increased 2.2% after shrinking for two consecutive quarters. Average hourly compensation for employees of non-farm businesses grew 5.2%, down from 6.6% in the fourth quarter. Despite the overall decline in business productivity, U.S. manufacturing firms continued to report productivity gains - but just barely. Manufacturing productivity rose 0.3%, down from 5.5% in the fourth quarter. Durable-goods firms saw productivity decline 0.1%, compared with a 6.6% increase in the fourth quarter. Firms that make non-durable goods saw an increase of 0.6% in the first quarter, down from a 3.8% increase in the fourth quarter. Productivity gains also persisted in the non-financial corporate sector, which Fed Chairman Alan Greenspan has called a "more accurate" gauge of general productivity trends. The government said productivity in that sector rose 0.3% in the fourth quarter, compared with 4.4% in the third quarter. The number of hours worked by employees of non-financial companies fell 1% while unit labor costs for such companies grew 7.1% The government releases productivity data for the non-financial corporate sector on a five month-lag.

To: pater tenebrarum who wrote (100461)	5/8/2001 9:28:42 AM
From: Lee Lichterman III	Read Replies (3) \| Respond to of 436258

OK, now I am really getting scared....... ...What Washington must do is keep the stock market up. America can't afford another big market dip, which is inevitable as things now stand. The government must take an active role in keeping stocks where they are now, or getting them to go higher. Washington must directly intervene if the stock market stumbles again. The Bush administration needs to directly buy stock index futures with government money to stabilize the market. And it needs to take that action so quietly that none of us know about it. nypostonline.com