Gekko

IN ONE of those bursts of effort that falling-down drunks can come up with, the economy showed a little more strength in the first quarter than people like me expected. This has provoked hope (among Democratic officeholders) and fear (in the bond market).

But there is less to the notion of an economy in “sustainable growth” than meets the eye. The higher-than-expected consumer spending that has got the credit markets spooked was driven by a couple of special circumstances. First, the erratic schedule of income-tax refunds, which pretty much go to people who need to spend them immediately, favored February and March. Weekly refund payments in those months were running 25 to 45 per cent above the levels of a year ago. That helped. But the Clinton tax increases on higher-income people will hit in mid April, and by May retailers will be looking elsewhere for cash for the register.

JD

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John Dizard

IN ONE of those bursts of effort that falling-down drunks can come up with, the economy showed a little more strength in the first quarter than people like me expected. This has provoked hope (among Democratic officeholders) and fear (in the bond market).

But there is less to the notion of an economy in “sustainable growth” than meets the eye. The higher-than-expected consumer spending that has got the credit markets spooked was driven by a couple of special circumstances. First, the erratic schedule of income-tax refunds, which pretty much go to people who need to spend them immediately, favored February and March. Weekly refund payments in those months were running 25 to 45 per cent above the levels of a year ago. That helped. But the Clinton tax increases on higher-income people will hit in mid April, and by May retailers will be looking elsewhere for cash for the register.