The March Group Finds Improved Consumer Spending and Manufacturing
Posted by Carl Doerksen on Mon, Mar 08, 2010 @ 08:55 AM
Recently released data points to continued improvement in several segments of the U.S. economy. According to an article in Reuters last week, U.S. consumer spending increased slightly faster than expected in January while the U.S. manufacturing sector grew, underscoring views economic recovery is progressing.
The Commerce Department said last Monday that spending rose 0.5 percent, increasing for a fourth straight month, after advancing by an upwardly revised 0.3 percent in December. Consumer spending in December was previously reported to have increased 0.2 percent.
Analysts polled by Reuters had expected consumer spending, which normally accounts for over two-thirds of U.S. economic activity, to increase 0.4 percent in January. "The message is continuing progress for the economy, if not as fast as hoped," said Pierre Ellis, a senior economist at Decision Economics in New York.
Also, an industry report said the U.S. manufacturing sector grew in February but at a slower rate than was expected. Analysts said it was still proof the economy is on the mend. The Institute for Supply Management (ISM) said its index of national factory activity declined to 56.5 in February from 58.4 in January. The median forecast of 80 economists surveyed by Reuters was for a reading of 57.5.
A reading below 50 indicates contraction in the manufacturing sector, while a number above 50 means expansion.
The ISM number "is still at the second highest level since late 2005," said Peter Boockvar, equity strategist at Miller Tabak and Co in New York. "The data provides more evidence that manufacturing continues to lead this economic recovery."
Data like this continues to provide ample evidence that the economy is improving and that 2010 should be a year of economic recovery. Certainly no one can accurately predict what will happen economically. The only constant we do have is that every recession on record has been followed by recovery. Although this recovery may be different from others, being lead by growth in manufacturing and exports rather than consumer spending, it will still eventually occur.
The critical issue facing you as an owner of a middle-market business is timing. Your company has just survived the worst economic downturn in decades and your business may only just beginning to improve. Having missed the last M&A boom in 2007, you are probably, like most middle-market business owners, beginning to consider the eventual exit of your company. As you know too well, owning a business is high risk financial proposition! Having nearly all of your assets tied up in an illiquid investment is not wise in the longer term.
The March Group has been helping business owners just like you to determine their exit strategy and timing. The first step in deciding when you want to exit is determining how much your company is worth today. Once you know that, you can then decide if 2010 is the right time to exit.
We believe that with all the data pointing to recovery, 2010 should also be a year of growth in M&A activity. We hold free information workshops around the country that are designed to help you begin your personal exit planning process. Don't miss the next M&A recovery cycle as you did in 2007. Having managed to survive the latest recession, do you really want to be running your company during the next one? If your answer is no, then contact us so we can help you begin the process of exiting your company.
http://www.reuters.com/article/idUSTRE6202E120100301?type=GCA-Economy2010