The debate on the economy has been whether the slowdown we’ve seen is cyclical or just a temporary pause due to the unusually harsh winter in the Midwest and Northeast. I’ve been of the opinion that weather has played a huge role in the slowdown and have kept our accounts close to fully invested.
Today we had some economic news to support my position. From marketwatch, “Builders continued to be affected by poor weather and difficulties in finding lots and labor,” said Kevin Kelly, NAHB’s chairman.
What’s interesting about this is the comment that builders are also having a hard time finding labor. With unemployment in the mid-teens for those with a high school diploma or less it’s hard to rationalize this labor shortage. However, to the extent it exists, this is the kind of push the labor market needs to see an increase in wages at the lower end.
Also today we saw Industrial production revised up for January and a solid .6% gain for February.
Also an index of manufacturing in New York rose to 5.6 from 4.5 in February.
Bottom Line: Stay the course with your investments. Stocks may be bumpy in the near term, but the outlook for the economy is looking very positive for this year.
Bill DeShurko 