You're watching...
Deutsche Bank Senior U.S. Economist Carl Riccadonna on the signs among small businesses that the economy is improving.
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
-- creating uncertainty about the economy lately but before getting too concerned.
Our next economist says there's one positive indicator that you are all over looking.
Carl Rica Ghana is a senior US economist at -- bank and he joins us now Carl.
I'm gonna -- this a little while longer that that particular issue that you're looking at that I -- look at -- well but first.
I got -- to -- represented from -- -- bank about Europe what happens in Europe from your perspective.
That's that that's a very good question I would say that's the million dollar question but that that will be putting far too low of -- -- price tag on things.
It looks -- like it's shaping up to be a long hot summer.
On the continent and certainly we're gonna have to keep all lives on not not only what's happening in Greece right now but Spain.
There are some up potential.
Preliminary.
Green shoots emerging in Spain the export numbers looked decent but that there's still significant corrections that have to take place.
And I suspect are going to hear a lot more negative economic news people we finally start to see a -- -- -- turn in the economic tied up over there.
Let's get to that one piece of data or that one indicator you look at that is good enough where you say you are very optimistic what is it -- Well there are a couple.
Key indicator of fund tracking in the economy right now.
-- number one is small business sentiment.
And number two is productivity and it's a little bit of a twist to the productivity story.
First of all what -- small business sentiment.
This was one of the act -- canaries in the coal mine if you will in the prior -- a couple of years small business sentiment faltered.
In 2010 Nancy economy.
Re weekend in the labor market stalled and that again small business confidence south faltered last year around this time.
How when that the pace of hiring slowed sharply as well.
-- so this time around we're keeping it very careful eye on that metric and actually worked back to.
Post recession highs and that series and a lot of the underlying components also look healthy as well.
Most of the employment that takes place in the US economy.
Takes place -- small and medium size businesses there -- an important early cycle job engine.
And that as goes small businesses will love probably go the labor market opt for the time being it seems to be holding up -- -- You know they're not only -- job creation are also good for innovation most of the real innovation doesn't take place -- the big companies takes place in the small and midsize companies.
That increases productivity and that's good for overall GDP so it's so important but I have to ask what is.
What is changing their attitude.
You know they were -- slammed by all these regulations and by concerns about higher taxes with the new healthcare program.
Why are they optimistic now.
-- great question.
And -- fortunately -- -- details of the NFIB.
Small business survey they do ask one question.
Which is what is the single largest.
Detriment.
To expanding your business right now and since mid 2008.
To present invariably the answered that to that question has been weak sales.
They complain about taxes thing gasoline prices and regulation and death.
A whole range of categories but -- Dominique concern.
Has been weak sales and finally.
We are seeing that weak sales category improved business sales -- the economy improve it's not just consumers.
But also businesses that spending as well.
And doubt that that seems to be was finally shifting the top.
Lower lower gasoline isn't until we're gonna have you back and not just because you thought I -- a great question I -- honestly not just for that reason alone.
Card rate to its target it speeded up because we got a lot of breaking news Karl richter doughnut from Georgia -- senior US economist thinks like I small business.
