The U.S. and Iran appear to have reached a tentative deal to extend the ceasefire for another 60 days.

According to news sources Iran would have to remove all mines from the Strait of Hormuz within 30 days. In exchange the U.S. would gradually lift its naval blockade on Iranian ports which would allow Iran to sell more oil.

That would be an unambiguously positive event. Oil and gasoline prices have already fallen sharply. The stock market climbed to yet another record high level. The inflation rate would soon begin to decline.

Once inflation begins to subside long-term interest rates would begin to decline as would the 30-year mortgage rate. This good news depends crucially on reaching an agreement which we think will happen. It is in the interest of both sides to do so. The U.S. has its mid-term election coming up in November. Trump and the Republicans do not want the war to still be an issue during the summer months leading up to the election.

The Iranians need to sell more oil to rebuild their country and, potentially, restart their nuclear program.  Lots of issues must still be resolved, but a continuation of the cease fire is a significant step in the right direction.

GDP growth in the first quarter was trimmed by 0.4% to 1.6%.  The war that began on Feb. 28 undoubtedly took its toll on growth in that quarter.

Real disposable income has declined in each of the past three months and has fallen 1.1% in the past year as the run-up in inflation has reduced consumer purchasing power.

Middle- and upper-income consumers still seem willing to dip into their stock market gains and spend at a moderate 2.1% pace to maintain their lifestyle, but lower income consumers are struggling.  With real income now declining one wonders how much longer middle- and upper-income consumers are willing to ignore the drop in their purchasing power.

Mortgage rates remain around 6.5% which is preventing what appeared to be an incipient recovery in housing at the beginning of the year when mortgage rates dipped briefly to the 6.0% mark.  The rebound to 6.5% mortgage rates quickly snuffed out that hint of a rebound.

An extended cessation of the fighting in Iran would, at a minimum, reduce oil prices.  WTI crude oil has already declined more than 20% from a peak of $115 per barrel to $88.  Admittedly, prices would remain far above the $65 per barrel price that existed prior to the war, but a 20% drop would be significant.  Wholesale gasoline prices have fallen by a roughly comparable amount.

A 20% drop in energy prices in the next couple of months could reduce both the overall CPI inflation rate and the core rate to about 2.5% by the end of the year.

Such a slowdown in inflation should allow bond yields to fall from about 4.5% currently to perhaps 4.0% by year-end.

That would, in turn, reduce the 30-year mortgage rate from 6.5% or so currently to perhaps 6.0% by year-end.

Lower rates and reduced inflation would power the stock market to even higher prices.

It is not clear whether 2.5% GDP growth in the second half of this year, an unemployment rate that remains at 4.3% which is essentially its full employment threshold, and a 2.5% core CPI inflation rate would be enough to get the Fed to cut rates.  We suspect that it will not reduce rates between now and yearend, but there is a new Fed chair who is so inclined.  We should learn more about his intentions following his first FOMC meeting on June 16-17.

The point of all this is that the outlook going forward depends largely on the outcome of the war. An extension of the cease fire is an important ingredient. We have seen in the stock, bond, and oil markets the positive impact it would have on the economic outlook for the United States, and it would do the same thing for other countries around the globe.

From 1980 until his retirement in 2003, Stephen Slifer served as chief U.S. economist for Lehman Brothers in New York City, directing the firm’s U.S. economics group along with being responsible for forecasts and analysis of the U.S. economy. He has written two books on using economic indicators to forecast financial moves and previously served as a senior economist at the Board of Governors of the Federal Reserve in Washington, D.C. Slifer can be reached at www.numbernomics.com.

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HCA Healthcare broke ground on its fifth freestanding emergency room in the Lowcountry, adding Cane Bay to its tri-county care portfolio.

According to a news release, the $15 million project will be 10,000 square feet with 10 patient exam rooms, a triage room, advanced imaging services, laboratory services and telemedicine for stroke and behavioral health.

“As our communities continue to grow, expanding access to emergency care remains one of our highest priorities,” Jeff Wilson, president of HCA Healthcare Charleston and CEO of HCA Healthcare Trident Hospital, said in a news release. “When we began planning for this freestanding ER, we knew this community deserved emergency care that is close, dependable, and built with its future in mind. Families are moving here, retirees are settling here, and businesses are investing here. With that growth comes a responsibility to ensure emergency care is never out of reach.”

In addition to the Cane Bay area, the new ER is expected to serve Nexton, Del Webb, Carnes Crossroads, and other surrounding communities. It will be open 24/7.

“This project is about more than constructing a building,” Wilson said. “It’s about strengthening access to life-saving care, supporting the long-term health of this community, and providing peace of mind to families who want to know expert emergency care is nearby when every minute matters.”

HCA currently operates a freestanding ER in Brighton Park, Centre Pointe, James Island and Moncks Corner. The company also plans to add a freestanding ER on Johns Island and Long Point in Mount Pleasant later this year, according to the release.

In 2025, over 350,000 patients received emergency care through an HCA Healthcare facility.

“When someone experiences a medical emergency, access matters,” Dr. Neal Shelley, ER medical director for HCA Healthcare Cane Bay ER, said. “This ER will provide proximity to emergency physicians, advanced diagnostics, and life-saving care when minutes matter most. It will improve response times, support our EMS partners, and give families confidence knowing experienced emergency care is close to home.”

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In 1985, Tracey Richardson and Kellye Wicker’s father opened a restaurant called The Rib Shack, with menu items featuring a ribs entree for $4.89 and a seafood platter for $5.29.

Though The Rib Shack has long since closed, and taken its $5 ribs with it, the flavors of its menu are carried on through Richardson and Wicker’s Lillie’s of Charleston, a retailer of sauces and spices inspired by Lowcountry cuisine.

The sister duo, along with Richardson’s husband, carries the workload of the small business entirely on their own shoulders.

Lillie’s is sold in large chain grocery stores, Charleston and Columbia airports, markets, and Amazon. The products are also used nationally, with South Carolina locations in colleges and universities, hotels, resorts and restaurants. Recently, the trio added popcorn to their portfolio, which Wicker said puts them back into a startup funding mindset.

“We’re competing against the other consumer product goods companies that have big marketing budgets and influencers, whereas we don’t have that to be able to get our brand out there. So, that’s a challenge in terms of the growth,” Wicker said.

Across the state of South Carolina, businesses like Lillie’s are taking out loans, purchasing a brick-and-mortar, and opening the door each day to both fresh and seasoned small businesses.

Qualified by the U.S. Small Business Administration (SBA) as an establishment with less than 500 employees, small businesses make up for 99% of businesses in South Carolina. Between 1998 and 2022, small businesses in South Carolina increased by 21%, with the population growth around 40% in that same period, according to Federal Reserve Economic Data.

For Frank Knapp, president and CEO of the South Carolina Small Businesses Chamber of Commerce, a major focus for the chamber is to address financial strain, like the increase in the cost of energy and access to affordable health care for owners and employees. To keep South Carolina businesses afloat, Knapp notes that these strains have been a fight for most of his career.

Between March 2023 and March 2024, SBA said small businesses contributed a net increase of 25,358 jobs in that time frame, 71% of the total job growth in the state.

“We’ve got to remember that our employees are the customers of small businesses, and we want them to have money to spend in the local economy,” Knapp said. “That has been our work for the past 26 years and it continues today.”

Making up for 43% of employes in the state, small businesses employ 863,326 South Carolinians. According to SBA data, of the 530,402 small businesses, 83% operate with no employees and 98% have less than 20 employees.

Richardson said that even with the accessibility to grow a business in the state, there are still struggles to managing Lillie’s.

“I think South Carolina is a great state to be a part of that actually supports small businesses because there’s opportunities to have manufacturing locations here and offices’ headquarters,” Richardson said. “I think that one of the main things I would like to see is more support for health care. We have to pay for our own health care, so there’s not a lot of options and there’s also very high thresholds.”

Knapp said that South Carolina is a great place to start a small business; the sector is performing well. He said there is no lack of success for small businesses in the more urban areas of the state, but the rural areas require a bit more attention to maintain a strong small business presence.

“Overall, I do not hear a lot of complaints from small businesses. Maybe some have their concern about this and that, but in general, small businesses are healthy, and their numbers are growing in South Carolina. That’s a good thing, and our job is to be an advocate for them,” Knapp said.

Founded in 1953, SBA opened following World War II to help revitalize the country’s economy by making sure those that returned had opportunities for wealth development, as well as job opportunities.

Melissa Lindler, district director of the SBA of South Carolina, said that though the country may not be recovering from a war, the purpose remains the same, connecting business owners with information and direction to capital.

As some industries, such as manufacturing, thrive in the state, sectors such as retail and agriculture are seeing more struggle. At the end of the day, Lindler said the primary challenge remains capital.

“I think one of the biggest struggles right now is trying to figure out tomorrow by understanding where you are today,” Lindler said. “That tomorrow may not look like it does today for you, but it may be what’s needed in terms of adjustments that will help you survive and continue as a small business owner.”

Top industries for the state include scientific and technical services, administration and waste management, real estate, transportation, health care, and retail. In 2025, 1,042 loans totaling $692 million were granted to top industries of food services, retail, health care and construction.

Lindler said the South Carolina government has done well to both draw new businesses into the state, as well as helping to sustain the businesses that are already here. Small businesses have a lot of room to play a role in the larger companies’ operations by understanding the needs and aiming to fill the hole for products that could begin being made in the U.S.

“That’s one thing about our small businesses here in South Carolina; they’re strong, they’re resilient, but they’re also constantly looking for ways to modify, pivot and make sure they’re ready for what’s to come,” Lindler said.

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The South Carolina Ports Authority is expanding ro-ro operations at the North Charleston Terminal, which has Palmetto Railways railroad access.

SC Ports said the first step has been project design approval, which came May 15. The ro-ro terminal is now under construction and expected to begin operations in 2027, with full completion in 2028.

“South Carolina is home to some of the world’s largest advanced manufacturers, who rely on the Port of Charleston to keep their supply chains fluid and businesses competitive,” Micah Mallace, SC Ports president and CEO, said in a news release. “SC Ports cares deeply about serving our customers. This plan demonstrates our commitment to investing in timely projects to meet their needs, and it ensures capacity to meet their growth every step of the way.”

Ro-ro terminals load and unload wheeled cargo. Instead of using cranes, cargo is driven or towed on and off the vessel on ramps.

By adding the terminal, SC Ports said it can expand container capacity at the North Charleston Terminal. It will be built following the demolition of a former paper mill site, which SC Ports acquired in 2024.

“We are committed to growth, and we will use every acre of our real estate to welcome new cargo opportunities to Charleston,” Mallace said. “Growth at the port drives opportunity within our maritime community and creates jobs around our state.”

The Columbus Street Terminal currently has breakbulk and ro-ro operations, allowing a capacity of more than 250,000 vehicles annually through the Port of Charleston. According to the release, South Carolina contributes to 18% of completed passenger vehicle export sales, the largest U.S. market share.

“As a trusted partner of SC Ports, Palmetto Railways is dedicated to providing efficient rail cargo handling and terminal switching services across all SC Ports marine terminals,” Patrick McCrory, president and CEO of Palmetto Railways, said in the release. “SC Ports’ initiative to provide expanded rail services at its North Charleston Terminal builds on robust existing rail infrastructure and improves capacity for future cargo growth. Together, we will continue working seamlessly to enhance service for our shared customers for ro-ro operations at North Charleston Terminal, while also collaborating on future business growth opportunities at Columbus Street Terminal.”

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After more than 10 years in the cocktailer mixer industry, Bittermilk is investing $8.2 million in new Charleston County operations.

Joe and MariElena Raya began the company from the small space of their original business; The Gin Joint. Today, the pair operates four lines: Bittermilk, Barcoop Bevy, Drinkmanship and Tippleman’s.

“We’re proud to continue growing Bittermilk in Charleston County, where our business began and where we’ve built strong roots over the past two decades,” Joe and MariElena Raya, Bittermilk owners and co-founders, said in a news release. “Being born and raised in Charleston, and growing up in the food and beverage industry here, has given us a deep appreciation for this community. It’s an honor to keep building our future here while continuing to make high-quality, American-made products.”

The expansion to a new facility located at 5340 Savannah Highway in Ravenel will create 12 new jobs while remaining family owned and operated, the release said. Currently, the team manufactures their all-natural products in a North Charleston facility.

“Bittermilk is a South Carolina success story, and their expansion is great news for the state. Forward-looking small agribusinesses are essential to the future of the industry, and we celebrate their growth,” Hugh Weathers, commissioner of agriculture, said in the release.

The new facility will be 12,000 square feet and is expected to be online this summer.

“Bittermilk’s expansion underscores how Charleston County is both an ideal location to establish operations and plan next-step opportunities that support long-term growth,” Joe Boykin, Charleston County Council chairman, said in the release. “This investment in Ravenel brings significant potential for future facility development, while creating high quality workforce opportunities and new amenities for the community.”

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The board of commissioners for the Housing Authority of the City of Charleston chose Nathan Frank Simms Jr. as CEO after a national search.  

Simms has more than 20 years of leadership experience in housing and community development including U.S. Department of Housing and Urban Development, the District of Columbia Department of Housing and Community Development, and the Housing Authority of Prince George’s County. Most recently, he served as executive director of the Norfolk Redevelopment and Housing Authority, a news release said. 

“I’m honored to join the Charleston Housing Authority at such a pivotal time,” Simms said in the release. “As Charleston continues to grow, it’s important that we expand access to safe, quality and affordable housing while continuing to be strong stewards of the resources entrusted to us. I look forward to building on the authority’s 90-plus-year foundation and advancing modern, sustainable housing solutions for our residents and community.” 

In the role, Simms will serve over 15,000 residents and manage more than 1,400 public housing units and 1,500 housing choice vouchers. CHA said his role will be to modernize and reinvest in the organization’s housing portfolio, expand affordable housing opportunities and strengthen residential services.  

Simms was picked from 72 applicants in a partnership search by Gans, Gans & Associates and CHA’s board of commissioners. The release said his grandparents, aunts, uncles and mother were born, raised and lived in downtown Charleston. 

“Mr. Simms distinguished himself through his depth of experience and his understanding of both housing operations and development,” Garcia Williams, vice chair who led the agency’s search committee, said in the release. “He brings the leadership and perspective needed to guide the housing authority as we address the evolving housing needs of our community while remaining strong stewards of public resources.” 

Originally from Washington, D.C., Simms has a bachelor’s degree in business administration from Bowie State University and a master’s degree in public administration from American University.  

Simms assumed the role on May 4. According to the website, he follows Arthur Milligan Jr., who has held the CEO position for about four years. 

“I’m focused on delivering results and building trust with our residents and the broader community,” Simms said. “Our work is not just about housing; it’s about creating opportunities and strengthening the future of Charleston. I look forward to getting started.”

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The Medical University of South Carolina has entered a partnership with Revival Healthcare Capital, an investment firm focused on medical devices.

The partnership is intended to accelerate evaluation, development and clinic advancement of medical technologies. A news release said the organizations have a five-year agreement with a plan to quickly begin project-specific initiatives.

“This collaboration reflects MUSC’s commitment to advancing innovation that improves patient care and health outcomes,” Dr. David Cole, president of MUSC, said in the release. “By working closely with Revival Healthcare Capital, our clinicians and researchers can help evaluate and inform the development of promising medical technologies, strengthening the pathway from clinical insight to real world impact.”

Clinicians and experts at MUSC will be invited to provide clinical and procedural insights to evaluate the technology with Revival’s investment plan. Additionally, some MUSC leaders will be advisers to the investment firm’s portfolio companies, according to the release.

The partnership put MUSC-originated devices on a quicker pathway to evaluation, with investment to support later clinical development.

“We are pleased to partner with MUSC to create a repeatable, high-velocity collaboration model that supports our investment strategy and our portfolio companies,” Todd Pope, senior partner at Revival Healthcare Capital, said in the release. “By combining Revival’s flexible capital model and operational capabilities with MUSC’s strong collaboration across patient care, research and education, we believe this partnership can advance technologies that address unmet patient needs.”

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Jared Hellman and his business partner, Andrew Hare, knew each other since junior high school. They grew up together in Hilton Head, a hotspot for the state’s hospitality industry.

The pair spent about 15 years in separate careers, Hellman in the tech industry and Hare operating his own business, Vertical Roots, for hydroponic container farming.

But before moving into separate fields, Hellman and Hare co-owned a deli in downtown Charleston when they were in their 20s. Today, they are taking a second run at the venture with three Lowcountry locations.

Startup Odd Duck is reaching into multiple neighborhoods of the Charleston area to establish a business fueled by local products that appeal to Lowcountry tastes.

“Personally, I think we were both motivated to get away from screens, and do something a bit more in the ‘real world,’” Hellman said. “As far as the concept, we were inspired by New York City corner store bodegas that are able to provide a community third space and a great cafe component with a cool assortment of goods. We wanted to do an upscale version of that.”

The team began with a location in Park Circle in July 2023. This year, they had an opportunity to expand into two new spaces, one downtown and one in Summerville. Hellman says each location will vary slightly based on local demand, Park Circle being more residential and suburban and downtown Charleston’s needs looking a bit more urban.

Hellman said from their first day with Odd Duck, the priority was quality over quantity, noting you can only scale with a good team of people and consistent cash flow. At the original Park Circle location, 10 of the 15 employees have been at the market for over a year, one of Hellman’s markers of success.

“If you have a concept you’re married to, you want to be careful what market you go into because if there are already a ton of them, you don’t want to face grueling competition,” Hellman said. “I also think being good owners and operators and taking care of your people is important.”

To soon have the startup in three Lowcountry locations, as well as a prep kitchen in North Charleston, Hellman and Hare are no strangers to what it looks like to grow a new business.

Hellman said each municipality has varied, but Summerville, for example, was a very pro-business, growth-minded city to expand into. Mayor Russ Touchberry checked in with the pair to ensure they had everything they needed to put the project into motion. They made an 1800s house into an operational enterprise in less than four months.

“Summerville’s a little bit different and it’s a small-town energy. They don’t want to be a suburb of Charleston; they want to be their own town,” Hellman said. The grassroots marketing approach is a bit different. You join the chamber of commerce, maybe you sponsor Little League, and you find out who is important in the community and make an effort to reach out to them.”

For startup businesses such as Odd Duck, support plays a key role in being able to thrive in differing South Carolina markets. Regional organizations such as Lowcountry Local First, StartupGVL, Boyd Innovation Center, and many others, work exclusively to see success in local regions of the state.

Boyd Innovation Center focuses primarily on scalable technology companies, which can range from a smartphone app and drone software to cyber-security technology and rural health services.

Boyd Executive Director Sam Herskovitz was originally from California, beginning his career path for about 12 years at a startup out of Los Angeles that was eventually purchased by ADP Payroll Services. He played a role helping a couple of smaller startups before an opportunity with Boyd Innovation Center.

“I just always really loved the scrappy startup, zero to one, figure it out, get stuff done, build-something-of-value stage,” Herskovitz said.

Herskovitz’s wife is originally from Columbia, where they currently live. After a few years in Charleston, Herskovitz returned to Columbia with an opportunity to lead the Boyd Innovation Center.

To Herskovitz, cyber-security has seen a huge growth statewide with different defense operations and insurance businesses, at a rate similar to that seen artificial intelligence and energy technology.

He said another large player is medical technology, which can be rural health, medical devices and the biotechnology industry. Universities such as Clemson and MUSC create a natural hub for statewide growth.

Boyd welcomes all companies in the state that are willing to commute to events and gatherings in Columbia, but is primarily supporting Midlands startups with a couple in Fort Mill and Lancaster.

Boyd’s primary focus is getting tech startups in their beginning stage from $0 to $100,000 in annual revenue.

“Technology companies focus more on value creation than on head count,” Herskovitz said. “The primary concern is not on job creation, though one of the side benefits of making a valuable technology company is that it produces high-paying jobs.”

Herskovitz said generally speaking South Carolina is business friendly, with leadership that is interested in startups and new technology. He credits some of the success of Columbia startups to the fact that even as Columbia and other state regions are growing and becoming well-known cities, they are still small enough to get access to people who want to help you succeed. It’s a big change from Los Angeles, he says.

On the flip side, launching a company in South Carolina does lend itself to specific challenges as well, one being access to capital. Herskovitz said the state is still a bit fresh in that way but he sees more venture capital sources popping up as entrepreneurship grows.

“Investment capital follows good businesses so the more that we can help produce good quality businesses the more outside capital will find its way here,” Herskovitz said. “So I think one of the best things we can do is just create an environment where there’s a density of successes and wins that bring more and more attention from outside capital.”

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A  California real estate company that specializes in workforce and affordable housing has invested in a 232-unity community in Summerville.

Ascenda Capital, a real estate investment and development firm, says it has acquired the multifamily property known as Bryant at Summerville for $51.5 million. The firm says the transaction marks its first investment in the Charleston area.

Located at 325 Marymeade Drive, Bryant at Summerville offers a mix of one-, two-, and three-bedroom apartment homes averaging 945 square feet. The garden-style community features a range of amenities, including a resort-style swimming pool, fitness center, fireside lounge, recreation room, business center, dog park and walking trail.

“Summerville is a high-growth submarket that aligns well with our investment strategy, offering strong fundamentals, continued population growth, and strong long-term demand drivers,” Matt Avital, principal and founder of Ascenda Capital, said in a news release. “Bryant at Summerville is a well-located community that gives us the opportunity to invest in a quality asset while expanding access to more affordable housing options in the market.”

Summerville has emerged as one of the fastest-growing communities in the Charleston metropolitan area, supported by continued population growth, employment expansion, and infrastructure investment along the Interstate 26 corridor. Its accessibility, relative value, and proximity to major employment centers have contributed to sustained renter demand and make it an attractive market for long-term multifamily investment, the company said in the release.

Ascenda Capital plans to execute a strategic asset management program focused on enhancing the resident experience and preserving quality housing options at a competitive price point as the Charleston region continues to expand.

Ascenda Capital says it has completed approximately $3.5 billion in multifamily transactions nationwide and currently owns more than 18,000 apartment units across a portfolio of more than 70 properties.

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Early this month President Trump said that “a whole civilization will die tomorrow” if Iran failed to meet his deadline to reopen the Strait of Hormuz. A day later he announced a 14-day ceasefire. Huh? What does he really want? War? Or peace?

While those two statements may seem confusing, to us they are simply Trump being Trump. It is his negotiating style. Keep people off balance. Be unpredictable. In this particular case we believe that he truly wants the war to end. Our reason has nothing to do with the war itself. It is based on the fact that the midterm elections are seven months away with a lot of campaigning that must take place in the interim.

Republican candidates will have a hard time convincing voters to reelect them if the fighting continues and gas prices remain above $4 per gallon. The cease fire may hold, but it will likely be a rocky road to peace. There will be regular skirmishes along the way and the rhetoric will be as acerbic as always. Nevertheless, we believe that the end is in sight.

It would appear that stock market investors agree with us. After plunging by 10% the S&P 500 has rebounded sharply and is currently 1.4% below the record high level set in mid-January. Given the volatility in recent weeks it feels like the stock market should be down by 10% or more. It isn’t. In fact, it is one good day away from a record high level. How can that be? We think it is largely because of the resilience of the U.S. economy.

For example, fourth quarter GDP growth was reported to be a meager 0.4%. But the six-week government shutdown that occurred in that quarter snarled air traffic, closed national parks, dampened tourism, furloughed thousands of federal employees and forced others to work without pay.

The Bureau of Economic Analysis said that the shutdown reduced GDP growth in that quarter by 1.2%. In other words, if the shutdown had not occurred the BEA suggests that GDP growth would have been 1.6%.

Then there is an alternative measure of economic activity in any given quarter known as “gross domestic income” or GDI. In theory, GDP and GDI should be identical because one measures the economy from the production side, the other from the income side. But they never are the same because they are derived from different sources.

GDI rose a solid 2.6% in the fourth quarter. The bottom line is that the government shutdown sharply reduced GDP growth in the fourth quarter and had it not occurred growth both GDP and GDP would probably have been in a range between 1.5-2.0%. Not great, but certainly not the near 0% growth that was reported.

Looking ahead to the first quarter we estimate GDP growth of 2.0%. The consensus appears to be roughly comparable at 1.8%. In either case, growth appears to have been moderate. But given everything that the economy has gone through, we find that growth rate impressive. Think about it. Businesses are still figuring out ways to adapt to the tariffs Trump imposed last year.

They are modifying their supply chains. Three-hundred-fifty thousand federal government workers were laid off last year and have had to seek jobs in the private sector. The federal government shut down for six weeks. The U.S. and Israel began a war with Iran in late February and oil prices have surged to $115 per barrel.

In ordinary times that combination of events should have caused consumers to sharply curtail spending and businesses to halt all new investment and lay off tens of thousands of workers. But that hasn’t happened. Instead, the economy still seems to be chugging along at a 1.5-2.0% pace despite these headwinds.

In the labor market payroll employment has slowed but mass layoffs have not occurred. At the same time fewer people need jobs because the labor force has stopped growing. As a result, the unemployment rate is 4.3% which basically means that everybody who wants a job still has one. In the fall the Fed cut rates twice because it feared the labor market would soften quickly. So where is the weakness? Once again, the economy is holding together nicely and defying the pessimists.

Could all those bad things be just over the horizon and clobber growth in the spring and summer months? Sure? But that is not our call. We believe the worst is over. If the cease fire generally holds together with only a few hiccoughs along the way, consumer and business sentiment should rise.

From 1980 until his retirement in 2003, Stephen Slifer served as chief U.S. economist for Lehman Brothers in New York City, directing the firm’s U.S. economics group along with being responsible for forecasts and analysis of the U.S. economy. He has written two books on using economic indicators to forecast financial moves and previously served as a senior economist at the Board of Governors of the Federal Reserve in Washington, D.C. Slifer can be reached at www.numbernomics.com.

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