Inventories for Major Businesses Piling Up
DEBORAH MARCHINI, CNN ANCHOR: Well, we're going to take a look this morning at an economic statistic that would ordinarily put most investors to sleep, but not, perhaps, today. Jennifer Westhoven is here to tell us more -- hi.</s>JENNIFER WESTHOVEN, CNN CORRESPONDENT: Hi. We are talking about, of course, business inventories. And you're right, normally, this is a snoozer. But lately, we've had so many companies -- and not just manufacturing companies -- that's the key -- technology companies talking about the fact that they have loads of inventory. They've got all these components that they thought they were going to sell or build into their networks. They're piling up. And, at this point, they're gathering dust compared to the point when we first started hearing these warnings. So this comes later this morning. It's expected to be up about two-tenths of a percent, is the estimate according to a poll of economists polled by Reuters. And you see that that is up a bit from December when it was 0.1 percent. Now, the one thing about this indicator, of course, it is considered pretty old. This is -- we're talking about January here. But it's something that the Fed has been talking about. It's something that's weighing on a lot of the economists' minds because, of course, as these companies build up inventories. they can't go out and buy new products for their inventories because they're not selling anything. And it's that overhang -- that's the keyword that people use -- that could have real consequences for growth going forward, for the GDP, is what people are talking about.</s>MARCHINI: This is a statistic, of course, that has to be taken in context. In a strong economy, rising business inventories would be good. We have to assume that, if they rise this time by more than 2 percent -- or two-tenths of a percent, as expected, it's going to be a negative for the markets because it means that stuff is not being sold.</s>WESTHOVEN: Well, it's certainly a negative for corporate profits, right? The only other thing is, if it was really, really out of whack, maybe it would make the Fed the think twice about just a 50- basis-point cut. But it would really have to be a shocker.</s>MARCHINI: All right. Jennifer Westhoven, thanks a lot.