Solving the Mystery of the “Great Disconnect”

We have a “Great Disconnect” on our hands.
On Monday, the Federal Reserve Bank of Dallas released its latest manufacturing survey. This wasn’t old, stale data; the survey was conducted in mid-July. And the results were awful, with the headline index plunging to -21 from -4 a month earlier. That was the worst showing in a year.
Yet the Dow Jones Industrial Average jumped 101 points. That happened in large part because FedEx boosted its 2010 earnings target.
Or how about what happened a few days earlier? The ECRI released its latest weekly leading index, and the results were dismal once again …
The index slumped to -10.5 percent, the worst reading going all…

Read more by Jutia Group

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