“While the equity market and accounting issues and corporate scandals are weighing on the economy, it is still fundamentally sound. The recovery process hasn't been derailed. We still think the economy is going to grow at about a 3.5-percent pace in the second half -- fast enough to keep the Fed from easing, but not fast enough to cause them to tighten this year.”
“I don't think [the confidence measures] tell you that much about what the consumer is going to do. I always tell people to look at what consumers do and not what they say.”
“My favorite indicator - my deserted island variable, meaning this is what I'd ask for if I were on a deserted island - is the Treasury yield curve. That's telling you we're expecting very strong growth over the next four quarters, albeit in the [second] half of next year.”
“We believe earnings momentum should turn strongly positive by the second quarter, but earnings gains in 2002 are unlikely to come close to reversing the collapse in 2001.”
“I think the Fed is on hold tomorrow and for the foreseeable future. We've actually been proponents of the view for quite a while that the economy was going to moderate, and it was important for the Fed to be patient. And one of the dangers was if the Fed kept raising rates, that they would slow the economy a lot more than they would want. So we think that there are enough signs of moderation that the Fed will remain on hold, and we think that signs of moderation will continue. So we think the Fed will be on hold through the end of this year and into early next year.”
