Thursday, August 13, 2009

Hooray

According to the Federal Reserve, the worst of the recession is over. The Fed emerged from its two-day meeting yesterday optimistic about the economy and the recovery, although it also said "economic activity is likely to be weak for a while."

You probably saw that the Wall Street Journal went even further: It polled a panel of economists and came away declaring that the recession is over - not just the worst of it, but the whole shebang.

So where does this leave us? It's good news; it's always a plus when the most qualified observers think the economy is doing well. But it certainly doesn't change anything fundamentally. The same companies still woke up this morning and tried to find new customers so they could make more money and grow. An assessment of the larger economy means very little for individual stocks. Not to mention for individuals looking for work; indeed, the WSJ panel of economists still expects unemployment to rise near ten percent by year's end.

I don't mean to be too negative; this is very good news. And it may be reaping dividends already - the dollar rose against the yen, apparently because of the Fed's report. But we still have a lot of work to do.

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