Economic Forecasting Firm: CEOs Unduly Pessimistic

ByJohn S. McClenahen No doubt about it, CEOs seem to be worrying more about the strength of the U.S. recovery from recession than a lot of other people. However, DRI/WEFA, a Lexington, Mass.-based economic forecasting firm, suggests chief executives' pessimism isn't warranted. For example, the closely watched Institute for Supply Management manufacturing index is signaling recovery, new orders for durable goods are rising, factory workers are putting in more overtime, and computer sales to businesses are on the rise, notes DRI/WEFA. The firm says it shares some of the executives' short-term concerns about profitability and credit availability. "But the CEO pessimism may relate as much to investor and regulatory pressures, threats to their own compensation, and the drastic shrinkage of acquisition prospects as to underlying business fundamentals," it states.