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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Clappy who wrote (51845)	5/21/2002 1:45:05 PM
From: Sully-	Respond to of 65232

Reuters Market News Fed's Ferguson-US economy still faces questions By Tim Ahmann WHITE SULPHUR SPRINGS, W.Va., May 21 (Reuters) - Federal Reserve Board Vice Chairman Roger Ferguson said on Tuesday that the U.S. economy is in a "turnaround", but that questions remain over the strength of the recovery. "It does appear that a turnaround is under way and the question obviously is how robust it is going to be for the rest of this year," Ferguson said in answer to a question after speaking to the North Carolina Bankers Association. He said the economy faces two questions. "One is when will businesses decide it is time to return to more robust investment profiles. The second is...will consumers, that have been in many ways the mainstay of the economy over the last year or so, continue to hold on to that role," he said. "I think the answer to those questions is not fully known yet," Ferguson said. His comments echoed the uncertainties voiced by Fed policymakers in a statement issued after their last scheduled meeting in early May, at which they left borrowing costs untouched. The U.S. economy steamed ahead in the first quarter, with gross domestic product growing a hefty 5.8 percent. However, those gains were in part fueled by a slowing in business inventory reductions. Fed officials and private economists alike believe that without sustained growth in demand from corporations and consumers, the strength of the recovery could peter out. On Monday, the New York-based Conference Board reported that its key forecasting gauge fell in April for the first time since September, as the economy ground to a near-halt in the wake of the attacks on the World Trade Center in New York and the Pentagon near Washington. The private research firm said its U.S. index of leading economic indicators dropped 0.4 percent after a 0.1 percent rise in March. While economic data have been mixed in the past few weeks and stock market investors have shown great concern about corporate profits, some upbeat numbers emerged last week. The Fed reported that industrial production rose 0.4 percent last month, in part due to a pick-up in auto production. Retail sales also turned in a solid showing, jumping a surprisingly large 1.2 percent in April, the Commerce Department reported last week, showing that the U.S. consumer -- which underpinned the U.S. economy during the slump that began last March -- is still hitting the shopping malls. Even with a report last week of a greater-than-expected 0.5 percent rise in consumer prices in April, or 0.3 percent after volatile food and energy costs are stripped out, most economists do not see the U.S. central bank starting to reverse a string of 11 interest rate cuts in 2001 until at least August. Policymakers are next scheduled to gather for an interest rate-setting meeting on June 25-26. biz.yahoo.com

To: Clappy who wrote (51845)	5/21/2002 2:19:58 PM
From: Jim Willie CB	Read Replies (2) \| Respond to of 65232

yes, dollar bounces after falling a little more to 111 I was razzing you about agreeing with me I am late to the party on investment side this winter I became a believer in the 10-yr commodity bull I wasted some time and money on oil/gas oh well we are in agreement but I see 360-380 by year end on gold price and a possibility that it could get out of control upside my fears are few, but big: - establishing a windfall profit tax on gold holdings - a stupid attempt to seize privately held gold - a sinister creation of a dual dollar system the dual dollar is a fait accompli, done deal Treasury is in the process of creating a foreign dollar, domestic dollar they are preparing for a possible and likely large devaluation which will be a screwjob to foreigners if that happens, or when that happens, I expect US longbond yield to rise substantially / jim