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To: X Y Zebra who wrote (6106)	10/10/2002 10:19:50 AM
From: X Y Zebra	Respond to of 57110

Wholesale inventories up 0.2% Warehouses holding record low ratio of stocks to sales By Rex Nutting, CBS.MarketWatch.com Last Update: 10:04 AM ET Oct 10, 2002 WASHINGTON (CBS.MW) - Inventories of wholesale companies rose a modest 0.2 percent in August while sales bulged 0.9 percent, the Commerce Department estimated Thursday. The long-term trend toward leaner inventories broke new ground as the inventory-to-sales ratio for wholesalers fell to a record low 1.22 from 1.31 a year ago. The average wholesaler has about 37 days of sales on hand. Read the full release. Most firms have slashed their inventories to match demand and are keeping stocks lean amid great uncertainty about how fast consumer and business spending will grow. Many economists believe a double-dip recession is highly unlikely as long as inventories remain tight. Most economic slowdowns are ignited or reinforced by sharp reductions in production and employment as firms work off their larger-than-desired inventories instead of ordering new goods. With inventories so tight, production here or abroad must expand to meet any new demand. Inventories of auto wholesalers dropped 2.3 percent in August as sales soared 4.1 percent. The inventory-to-sales ratio for auto wholesalers fell to a record low 1.27. For all durable goods, wholesale sales rose 0.3 percent and inventories rose 0.2 percent. For non-durable goods, sales rose 1.5 percent and inventories rose 0.1 percent. The wholesale inventory data supplements information on manufacturing inventories released last week. In August, manufacturing inventories were flat. Still to come are inventory data at the retail level.