On Wednesday, economic reports showed that new orders at U.S. factories jumped more than expected in July due to a rise in transportation orders. These reports and comments made by Home Depot (HD) CEO Frank Blake helped the Dow finish higher in a mixed day of trading.
"We don't think we're at the bottom yet, but we think you can see it from here," said Blake at a Goldman Sachs retail conference on Wednesday. Blake added that Home Depot could see "very modest" improvement in the second half of this year as sales and earnings comparisons became easier.
Also, the Federal Reserve said in its Beige Book report that economic activity has been slow across most of the United States in recent weeks, though there has been some relief from high commodity and energy prices.
Finally, in a speech by Boston Fed President Eric Rosengren, Rosengren attacked the rationale of other Fed officials who have been calling for the central bank to lift the benchmark Fed funds rate from 2% sooner rather than later.
Some in the Fed had said they need to raise rates now because the 2% level is too "accommodative" which loosely translates into too low, too stimulative and maybe too inflationary.
Rosengren argued that if the Fed had not been as quick to react or as accommodating, the credit crunch and economy would be in much worse shape. He believes that the Fed will continue to hold the rates as they are now for the foreseeable future with the risk of inflation being mitigated by a drop in commodity prices.
If the Fed were to raise rates, the banks that are the primary credit lending institutions would need to raise additional capital which would cut the flow of new loans. This is not something that he believes would help the economy or the credit crunch.
Sources: Wall Street Journal, CBS Marketwatch, Reuters
"We don't think we're at the bottom yet, but we think you can see it from here," said Blake at a Goldman Sachs retail conference on Wednesday. Blake added that Home Depot could see "very modest" improvement in the second half of this year as sales and earnings comparisons became easier.
Also, the Federal Reserve said in its Beige Book report that economic activity has been slow across most of the United States in recent weeks, though there has been some relief from high commodity and energy prices.
Finally, in a speech by Boston Fed President Eric Rosengren, Rosengren attacked the rationale of other Fed officials who have been calling for the central bank to lift the benchmark Fed funds rate from 2% sooner rather than later.
Some in the Fed had said they need to raise rates now because the 2% level is too "accommodative" which loosely translates into too low, too stimulative and maybe too inflationary.
Rosengren argued that if the Fed had not been as quick to react or as accommodating, the credit crunch and economy would be in much worse shape. He believes that the Fed will continue to hold the rates as they are now for the foreseeable future with the risk of inflation being mitigated by a drop in commodity prices.
If the Fed were to raise rates, the banks that are the primary credit lending institutions would need to raise additional capital which would cut the flow of new loans. This is not something that he believes would help the economy or the credit crunch.
Sources: Wall Street Journal, CBS Marketwatch, Reuters
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