The market continues to display a total lack of direction reflecting the economic uncertainties, the foreign involvement in Iraq, and the lack of new jobs despite the never ending talk of a business expansion. The Federal Reserve’s modest increase of 25 basis points in the Fed funds rate has unnerved financial markets even though the slight increase from near 50 year lows will not have any substantial impact on economic activity. The fear arises from the change in trend more than any tangible reason. We prefer to look at the real economy, which appears once more to be in a stagnant mode. Consumer spending waned in June and from indications appears to be waning in July. Similarly, corporate hiring so far during this “recovery period” is less than typically experienced as an economy moves from recession to growth. Maybe autumn will bring a more vibrant economic recovery than that experienced thus far.

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