TUESDAY MARCH 2, 2010

Beware the Snowman

As we are all painfully aware after shoveling snow all week, the entire country has been under a winter storm watch for what seems like an eternity.  The Northeast has been blasted with not one, but two blizzards in the last few weeks.  And the snow does more than cover our driveways, it affects the economic statistics as well.  Investors need to be careful as they watch the economic statistics for the month of February, starting with Friday's Unemployment report.  There is no doubt that the weather will create "noise" in the numbers.  The weather will reek havoc on employment trends.  For example, the snowman will clearly have an impact on construction related jobs.

The economic numbers have continued to show improvement.  However, the recent numbers have shown some moderation in the improvement,  Yesterday's ISM Manufacturing index came in at 56.8, a good number indicating the manufacturing sector continues to grow.  However, the number was less than expected and down from the previous month.  How much did the weather impact this number?  It is difficult to say.  Investors should try to separate the weather from the underlying trend in the economy.  The trend is never a straight line.  The weather is certainly a bump in the road.  But, for now, I continue to believe the trend is an improving one and that should help the stock market.

POSTED AT 1899-12-30 10:06:00.0

KEN ENTENMANN, CFA
SENIOR VICE PRESIDENT AND
THE DIRECTOR OF INVESTMENT MANAGEMENT SERVICES

Ken is a Senior Vice President and the Director of the Trust and Investment Services at Alliance Bank, N.A. He has 23 years of investment experience and oversees the management of assets totaling $1 billion. He holds a B.S. in Applied Economics and Business Management from Cornell University and an M.B.A. from the William E. Simon Graduate School of Business Administration at the University of Rochester. He has also earned his Chartered Financial Analyst designation. He is a member of the Executive Committee of the Trust Division of the New York Banker's Association. He is also a director of the Central New York Community Foundation.

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