Readiness is All

Many commentators are frustrated because their predictions of a recession early this year aren’t coming to pass. Not to mind, they insist. The upcoming downturn, while delayed, is not to be denied.

The number one culprit in the search for their error’s source has been the government’s economic stimulus checks. But the total cost of the program was $100 billion in a $15 trillion economy—less than 1%. And the sub-prime crisis has show us again that we can’t borrow our way to prosperity. So what’s the real source of our economic strength?

Exports have been on a tear. Agriculture, capital and construction equipment, technology, and services have been strong sources of domestic growth. Add to this the weak dollar, and we’ve seen foreigners buying US goods and services in droves.

This isn’t going to change over the summer. US companies have been marketing overseas for years, and now their efforts are bearing some fruit. A stabilizing housing and energy market should allow economy to continue to muddle along, with the improvement in trade serving as the engine.


Douglas R. Tengdin, CFA
Chief Investment Officer
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