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Pros Say: Consumer Weakness Will Slow Recovery

Thursday, 25 Jun 2009 | 3:46 PM ET

Fed Chairman Ben Bernanke testified in front of a House CommitteeThursday that he did not put pressure on Bank of America to close the takeover of Merrill Lynch. Unemployment numbers released are showing a weak job market and GDP growth is still in a decline. Read and watch what the pros say...

Consumer Weakness Going Forward

"We have a negative view on consumption. We've had a negative view for months and we continue with that," said Clark Yingst, chief market strategist at Joseph Gunnar and Company.

Boosting Your Portfolio
How to pay the markets, with Clark Yingst, Joseph Gunnar & Company and Alec Young, Standard & Poors.

"Last month's numbers on income and savings show that with the savings rate [a 15 year high] ... that we are not just in midst of a cyclical change in consumer spending but a secular change and if that's right, the slope of any recovery is going to be gradual," said Yingst.

Bigger Trends For Markets

"We are trying to focus on trends like tech, energy, emerging markets, areas that are least likely to disappoint with the growth they will produce," said Alec Young, equity strategist at Standard & Poor's.

"We want to focus on areas that will outgrow the overall economy," Young said. "We think China fits the bill, that's what really driving oil and commodities. And for technology, we think companies have to spend a certain amount for maintenance. Those are areas along with emerging markets that we want to say with."

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