Between the Lines: What Those Crystal Ball Business Confidence Surveys Can't Tell Us
The Scotsman › August 28, 2007
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Summary
CONFIDENCE is what makes markets and business go round. When it flowers we take it for granted. When it withers, we immediately feel the icy blast.
"Confidence" is a key transmission mechanism between the financial markets and "real world" business. So the big talking point in recent days is whether the intense turbulence that has shaken credit and stock markets in July and August will transmit to a slowdown and possible recession in the "real" economy. What do these business confidence surveys tell us? And are they reliable guides to what the future has in store?See the full content of this document
Extract
Between the Lines: What Those Crystal Ball Business Confidence Surveys Can't Tell Us
This is an area fraught with problems, not least the different time horizons between financial markets, where the value of a business and its earnings potential can change dramatically in seconds, and t...
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