Read this week’s Tea Leaf :

February 2, 2010
“Solid Growth”

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“Once again, Jeff did an outstanding job speaking to hundreds of our dealers from all across the country.  This time it was over the phone. His command of the facts and his professional delivery of economic information provided our dealers with a dose of reality, yet left them with true optimism for the future of America.”

—Dave Zerfoss, President
Husqvarna Professional Products, Inc.
(the world’s largest producer of lawn mowers, chain saws and portable gas-powered garden equipment)

Tuesday, February 2, 2010

The U.S. economy grew at a 5.7% real annual rate during 2009's final quarter, the strongest growth pace since the third quarter of 2003. This compares to a 2.2% growth rate in the prior quarter. Modest economic growth of around 3.0% is expected to continue in coming quarters

The U.S. unemployment rate remained unchanged at 10.0% in December 2009. The U.S. economy lost another 85,000 jobs in December, after registering a slight gain in November. Over 7.2 million net jobs have been lost since the recession began in December 2007

Consumer prices in 2009 rose 2.7%, following a 0.1% rise in 2008 (the smallest rise since 1954), and a 4.1% increase during 2007 (the highest annual climb since 1990). We expect consumer prices during 2010 to rise 2.0% to 2.5%

The Federal Reserve's target federal funds rate is currently a range of between 0.00% and 0.25%, its lowest level on record. This target rate has been in place since December 2008, and is expected to remain at this level through at least the first half of 2010

We remain bullish on stocks