Economic recovery’s in the air. Can you smell it?
Has this ever happened to you?
You're walking down the street, thinking about nothing in particular, just enjoying the day, when the faintest aroma hits your nose -- so faint that you're not sure you smelled anything at all. You turn your head ever so slightly and suddenly, there it is again, so faint it's almost a memory. But that's all it takes, and then WHAM, you're suddenly on sensory overload, long-dormant memories breaking through the levies of your mind.
It happened to me the other day. I was out for a late afternoon jog when it hit me, clear as day: banana pudding. The faintest whiff of banana pudding drifted past, and suddenly, right there on Grant Road in suburban St. Louis, I drifted back to my boyhood home and my mom's kitchen in Western New York.
Weird, huh? There likely wasn't a bowl of banana pudding within miles of me, but for a couple of minutes that afternoon, that's all I could think about.
It happened again today. This time it wasn't banana pudding I smelled, but economic recovery. If you stop for a moment and the wind is just right, you might be able to catch a whiff of it, too. And then another. And another.
- The Dow Jones industrial average was up 7.7 percent in March, its first month of gains in six months and the Dow's best March since 2002. The NASDAQ was up 10.9 percent, its best March ever.
- Orders for durable goods (big-ticket items like cars, appliances and furniture) unexpectedly jumped 3.4 percent in February.
- Consumer confidence rose slightly in March.
- After sinking to all-time lows in January, new-home sales rose 5 percent in February.
- Existing-home sales rose 5 percent in February and mortgage applications were up more than 30 percent in late March.
And yes, in deference to you cynics out there, I realize you can counter each of my good-news references with some bad news of your own. The Dow is up in March? Year-to-date, it's still down 13.3 percent. Consumer confidence is up? It's still near historic lows. Home sales are up? It's only because home prices have dropped so far. And unemployment continues to rise, and with it, human suffering.
I'm not trying to diminish those things. There is a real human cost to what's happening today, and we can't overlook that.
But if we focus only on how bad things are, we'll never recognize the signs of recovery when they surface.
So my message to the cynics is this: Go climb back into your bunkers and wait for the apocalypse. We're better served by looking for the good signs.
And I'm not alone. Business Learning Institute instructor Frank Ryan writes:
"Markets are about psychology. If we believe the markets are crashing, they will. Perception becomes reality. As with bubbles, panics are fueled by irrationality.
"All the same, we have to deal with both the perception and the reality of the current market crisis.
"This current crisis is about leadership. It is about people – and I mean all of us – reacting calmly. Economic growth is fueled by a positive attitude and not a pessimistic one. As financial executives, we are uniquely positioned to assist in the turnaround that, I believe, is currently under way."
Frank smells that turnaround. So can I.
If you stop and turn your head, you might be able to catch a whiff of it, too.