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Location: Nashville, Tennessee, United States

7/28/2003

Economy: Lots of Good News
There's plenty of good economic news coming out – just in time to upset the hopes of Democrats who planned to run against George W. Bush by blaming him for a bad economy…

From the Associated Press:

The economy is showing fresh signs of snapping out of its funk: Orders to factories for big-ticket goods registered the biggest increase since the beginning of the year and new-home sales climbed to the highest level on record. The latest batch of economic news Friday reinforced hopes that a much anticipated revival will take hold in the second half of this year.

"It really is beginning to look as if the train has finally left the station," said Joel Naroff, president of Naroff Economic Advisors. "The news was very good and adds to the belief the economy is on the mend."

Especially heartening to Naroff and other economists was a Commerce Department report showing orders placed to U.S. factories for "durable" goods - costly manufactured products expected to last at least three years - went up by a solid 2.1 percent in June from May.

The increase - nearly double what economists were forecasting and the biggest since January - suggested that the battered manufacturing sector is finally turning a corner. The advance came after America's manufacturers saw demand for their products fall by 2.4 percent in April and stay flat in May.

In more welcome news, sales of new, single-family homes rose 4.7 percent in June from the month before to a seasonally adjusted annual rate of 1.16 million units, the best month for sales on record, the department said in a second report. That comes on top of a 10.9 percent jump in new-home sales from April to May.


Meanwhile, sales of existing homes remain in record territory, according to the National Association of Realtors, which has forecast a record year for home sales this year.

And Donald Luskin comments on a report of a surge in venture capital funding and says, "Funny what a little tax-cutting will do, isn't it?"

Predictable, too. Tax cuts lead to economic growth. Always have. Always will.

UPDATE: Chicago Federal Reserve President Michael Moskow says the economy is getting ready to rev up.