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New data on US consumer sentiment today hitting a six month low on weakness in labor market it's a very difficult time for a lot of businesses -- in this country particularly.
If your business ties it directly to those ebbs and flows of the economy.
But one of those companies is survived many ups and downs and is today celebrating 175.
Years in business.
Agricultural equipment maker John -- just rang the closing bell in New York Stock Exchange and -- -- to be able joined by CEO Samuel Allen.
Welcome CMR Allen.
Thank you can be written all right let's -- the US and business here how -- after this rough economy.
We've been very fortunate especially as you -- -- agricultural equipment side up but because farmers to especially corn and soybean farmers.
Have been doing extremely well and so we're sitting very very high levels.
-- -- -- last couple years -- solar project being this year you know be out record breaking out.
Now recently course commodity prices have come down I imagine those short term ebbs and flows of commodity prices don't change your plans at all in terms of equipment -- right.
Therein into the farmer they're net incomes are still gonna be at very high levels and even though commodity prices have come down -- The input costs have come down as well -- -- fuel and and natural gas costs salt.
All in all looks a robust farm economy and we think it's gonna stay that way for a long time to -- But your capital spending is so aggressive I mean you have in May came out with the with plans of about a 44% increase over 2010.
I guess one point three billion of capital planned spending -- are -- trimming that at all because of concerns about a slowing global economy.
We have not yet you are correct to have that one point three billion about 57%.
Well let's say of the last five years about 57% of our total capitals can spend here in the United States to continue to expand and upgrade our facilities here.
But we also have seven plants under construction and other parts of the world and once you get those going it's kinda hard to fact that down unless it becomes an absolute necessity so we're watching it very closely.
If we saw tremendous spike downward obviously we had written have to readjust but we're putting those plants in for the long term not just for the next six months.
But are their regions that you look to to offset the slowing in Europe.
And obviously the -- that we've seen in China as well.
Yeah I think one of the most promising areas for us in the near term.
As the southern column and particularly Brazil Argentina they can get -- -- -- would also be but Brazil's a tremendous opportunity.
Has been for us on -- and we're in the process of building to construction equipment plants.
Which will be in place by the time the construction goes on for both the World Cup as well as last Summer Olympics -- We think construction and -- in Brazil will be a great opportunity and then we see the CIS countries in particular for agriculture.
Being a great opportunity.
It's up Russia's up significantly again this year.
And we think -- -- things stabilize from a government standpoint there will be tremendous opportunity and that market over the next three or four years.
What about the China slowdown I was recently in Australia and and and they are concerned about that because they they yeah.
Provide -- -- was so much of the basic raw materials they need of course a lot of the folks in Australia used John Deere equipment and ordered -- make that stuff and send -- to China is that a concern for you.
I think it's more in the near term a concern for what you're alluding to some of our customers around the world that -- supply.
A lot of the grain imports to China.
From our standpoint and our construction equipment business is just taking off and that's where China's had a real slowdown but we have an an impact because we're just starting up an air.
On the agricultural equipment site where we've been doing business in their for 35 years it's a tale of two cities the small tractor market for small farmers.
That's slow down some but China in their fight your plans as a real focus on getting big productive equipment in there.
Through consolidation -- farm so cooped and that still continuing on and that is fueled also by government.
Providing that the monies to support that salt.
We don't see us the slowdown in China as much as -- didn't.
Sam Allen Sam you don't look a 175 years old -- -- you look pretty good for your.
Event that the company of course celebrates its 175.
Birthday today happy birthday to you Sam Sam Allen chairman and CEO of these.
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