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Word of the moment: Optimism

January 3, 2011

I am a natural contrarian, but I’ve become positively giddy over the last few weeks because all of the good data coming in for the U.S.

ISM Manufacturing came in great again today, and the details were even more bullish than the headline numbers.  Lots of new orders, low inventories – I have seen this mentioned in several places.  If you recall, I was worried about inventories not growing that fast or even getting drawn down a bit, which will take GDP growth away.  This ISM number is strong enough to dispel those fears – we may see 5% growth in Q1 2011.

My man with insight to manufacturing, aka my dad, tells me that factories are either running full out or idle, with no inbetween.  This tells me that companies are squeezing every last drop of productivity out of the operating factories, trying to minimize the costs associated with running multiple facilities at 65%.  Plants that are working are running 6 days a week, some at 7 days.

I have seen the word optimism enough over the last week that it makes it my word of the moment!  Let’s enjoy it while it lasts!

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