Wall Street takes a drubbing today to end the week down following the release of some weak manufacturing data. Investors overreacted in my opinion, though I understand the fear: the weak housing sector is starting to spill over into other sectors of the economy previously thought to be unaffected by the downturn in housing.
But some caution need to be exercised for two reasons. First, the data is only for one month, which does not signify a trend. Second, since manufacturing accounts for only 12% of economic growth why all the fuss?! It is consumer spending, which accounts for two-thirds of economic growth, which matter the most.
I'm not sushi. A downturn in manufacturing will mean job losses and thus less consumer spending but, like I said, a month's data is not indicative of a trend. Bears need to slow their roll.
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