But that’s not how the executives of big companies see things. Jurgen Hambrecht is chief executive of BASF, a giant manufacturer with sales of more than €50 billion (£37 billion), garnered by selling hundreds of thousands of products to a wide variety of industries. He told the press that he does not foresee an American recession, and that “I am glad to say that business in general does not show the panicking approach of the financial industry . . . I am sleeping well at night.”
Hambrecht is not alone. Executives at General Electric, Honeywell, Procter & Gamble, Kraft Foods and the ultimate owner of this paper, News Corp, are among the many who claim their businesses have never been better, that sales and profits are up, and that bookings are strong. The more cautious add “so far”.
If the economy is indeed stronger than high oil prices, housing woes, and slower job growth would lead us to believe, and if inflation is the looming threat that it increasingly seems to be, perhaps policymakers would do well to turn a deaf ear to the bankers who clamour for “more”. Better to stand pat until recent rate cuts and the new stimulus package take effect later this year.