NFIB Small Business Optimism Index

TRADEX GLOBAL INTERNAL COMMENTARY

“Steady as she goes” was the phrase for small businesses in October, according to NFIB.  The monthly index tipped up a little to 93.1 from 92.8, and there was little change to any of the components making up the index.  The index remains in a narrow “recession” level range.  Overall, the sentiment in small and large businesses is “do nothing until the government shows its hand”!!!  I have been very focused lately looking at the hi yield space as we get ready to launch our short-biased HY fund.  It is amazing that with very slow growth, a fiscal cliff down the road and Europe mired in a depression, the companies rated “junk” have the ability to raise capital in the bond markets at crazy, historically low yields.  I hate to say this, but I really believe the HY credit market will start cracking very soon and this NFIB report helps confirm it.  Keep nimble – Michael Beattie

EXTERNAL RESEARCH COMMENTARY

Economic conditions faced by small business owners were little changed in October, amid continued anxiety about the future, fueled largely by political uncertainties. On Tuesday, the National Federation of Independent Business reported its monthly index tipped a touch higher to 93.1, from 92.8 the month before. There was little change in any of the components making up the index, with the report saying the overall index remained “in a small, narrow ‘recession’ level range.” The October NFIB survey was compiled before elections that saw President Barack Obama hold his office, amid continued Democratic control of the Senate, and Republican control of the House of Representatives. The uncertainty at the heart of the NFIB survey arises largely from the inability of lawmakers to tackle what’s called the fiscal cliff.

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