A lot can happen in seven days… Just look at Creation, and FedEx. – Ilene
Shouldn’t Somebody Be Looking Into This?
Courtesy of Michael Panzner at Financial Armageddon
A week ago, I highlighted a report from the Financial Times, "FedEx Warns on US Recovery," in which the head of the U.S. transportation and logistics company expressed concerns about the health of the economy:
The nascent US recovery could falter because businesses are still reluctant to invest in new equipment and technology, the head of global delivery and logistics company FedEx has warned.
“Business investment went up somewhat in the fourth quarter but is far below what it ought to be in a cyclical recovery like this,” Fred Smith, chairman and chief executive of FedEx, told the Financial Times.
He added that companies were being held back by continuing “uncertainty” over the outlook.
During the downturn many companies, including FedEx, cut their capital expenditures in response to falling demand, moves that in turn intensified the drop-off in economic activity. The levels have yet to recover.
Boosting investment spending was crucial to catalysing a sustainable recovery, Mr Smith said, because it created jobs. When people were worried about unemployment, they tended to spend less, undercutting a driver of the economy.
Now, just seven days later, there appears to have been a miraculous turnaround, as the Associated Press reports in "Fedex Sees Economic Recovery Spreading":
FedEx says the global economic recovery is broadening, as Asia continues to show strong growth and the U.S. economy gains steam.
Fred Smith, CEO of the world’s second-largest package delivery company, predicted a "relatively strong" first half as major economies emerge from the recession with steady economic growth in the last six months of the year.
FedEx expects U.S. gross domestic product to grow about 3 percent this year, led by the manufacturing sector, in line with economists’ expectations.
I’m not sure if 1) somebody has been misquoted; 2) this is one of the most egregious examples of expectations management I’ve ever seen; or, 3) somebody forgot to take their meds (or took way too much), but either way, shouldn’t an editor, a regulator, or a doctor be looking into this?
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