Federal Reserve Chairman Ben Bernanke is not one to mince words, nor sugar coat anything. And that should be encouraging. Benanke helped to prevent a crisis from becoming an outright calamity.
Yesterday, he made a very simple statement to Congress: Economic recovery will be slow! Period. No waffling, no backtracking. Reasons? Not much has changed:
· Employment situation is still weak
· Credit is still tight, and
· Consumer spending is still affected by declines in equity and housing wealth
New data today on chain store sales were down in May; but jobless claims were slightly improved. Wal-mart announced some good news – they will hire 22,000 workers this year. It can be done. This is a normal variation in data for what we are going through.
The market hiccupped yesterday due to uncertainties about how to interpret all the data. Futures today indicate it should be back on the plus side. Here’s the certainty: the market will be volatile for months.
No big home runs on the horizon. Big Papi will eventually come out of his slump by focusing on the fundamentals…Wal-mart does just that…and so should we.
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