In the last post, Warren Buffett commented what he was seeing with regard to signs of an upturn. This link contains what John Rice, Vice Chairman of GE recently (6/19) said:
“I am not particularly of the green shoots group yet,” Rice said today to the Atlanta Press Club, referring to a phrase used by Federal Reserve Chairman Ben S. Bernanke that described signs of a nascent recovery. “I have not seen it in our order patterns yet. At the macro level, there may be statistics suggesting the economy is starting to turn. I am not seeing it yet.”
Between Warren Buffett and John Rice, there is a tremendous size and breadth of businesses overseen. Their comments seem to support the question as to whether “green shoots” exist, i.e. is the economy showing signs of recovery?
This question is absolutely critical at this juncture, for a variety of reasons. Perhaps chief among them is the following: If there currently is no economic recovery, how sustainable is the stock market (as well as other markets’) rally since early March? If there is no economic recovery, is that some type of proof of the ineffectiveness, or failure, of the intervention efforts? Are we heading toward Sustainable Prosperity?
SPX at 918.90 as this post is written