The most eagerly anticipated greenspan speeches---Mike (fast)
>> computer associates has ended giving stock option grants to its board of directors and instead boosted their yearly fee by 60%. the company said it raised the pay to match that of rivals and because the board’s duties increased as new corporate governance rules were adopted. all employee and nonemployee directors received a raise except the chief executive officer and vice president russell arts. shares of computer associates have more than doubled in the past year.
>> the world’s second largest computer distributor missed wal-mart earnings estimates in the last quarter, and that put shares of tech data as much as 5% into the red today, ending the day down 1.7%. net income from may through july was half what it was a year earlier. excluding special items the operating profit was 34 cents a share, two cents less than analysts expected. on the other hand, revenue for the quarter rose 4.5% beating the consensus forecast. chief executive steven raymond expects improvement in earnings this quarter.
>> we have seen a slight pickup in demand. it’s not as robust as everybody would like to see, but nevertheless, it does represent an upturn from where we had been in previous quarters.
>> 40 to 45 cents a share is what tech data is predicted for this quarter which ends in october. the average estimate of analysts currently is 41 cents.
>> as we’ve been telling you, federal reserve chairman alan greenspan speaks to the kansas city fed conference at jackson hole tomorrow morning at 10:00 new york time. michael mckee is here to preview one of the most eagerly anticipated greenspan speeches in some time.
>> this is a big one, a lot of interest, even for the last of august, because the bond market and fed are sort of in the same area arguing over who is running the economy these days. ever since the fed meeting of may 6th when the central bank said that it was worried about a substantial further fall in inflation and bond yields fell sharply, the fed and bond market have been having a dance about what exactly the federal reserve was going to do about it. on june 25th, the fed said it was―it cut rates by a quarter percentage point to 1%. the bond market had wanted more, and so at this point there is much confusion about whether the fed is going to go farther. there is a lot of hope greenspan is going to explain himself tomorrow.
>> that fits in with the theme of making monetary policy in uncertain times.
>> for years the fed’s job was to control inflation. now the fed is trying to both control inflation and control the possibility of deflation. we saw in the second quarter g.d.p. numbers today that the personal consumption expenditure index which the fed follows, rose only 7/10 of 1 percent in the second quarter, almost down to zero, with measurement errors you are just about there. the fed is as concerned about that as they are inflation, but it’s two different strategies for fighting it and the market is not sure what they are going to do.
>> the fed is in the midst of a debate over changes to monetary policy, how to communicate those changes.
>> there is both a question of how they make monetary policy and how they talk to the markets about it. a lot of confusion in the statement recently about how the fed says what it’s going to do. they’ve been very vague just saying they are going to keep rates low for some time. but how long is some time? markets want more information than that. they see the economy growing at a faster pace, like we saw in the second quarter g.d.p. numbers today.
