This liquidation has been so sharp, so severe, not just in this last quarter, but over the past year, that even with a modest pickup in demand, production is almost bound to increase as we move through the balance of this year.

To me, the business cycle is working as it always does, absent an external shock. Inventory liquidation means firms have to increase production, and they're already doing that. They're also increasing the length of the work week and hiring temporary workers. All these things support income and spending.

We did not see anything in the second quarter results that would cause us to alter our full year 2005 stand-alone estimate for Federated of $4.58 per share,

They've got more room to move, and they will move. That's what they've always done in past recessions and what they'll do again.

I'm not sure Taylor has the political savvy for the job.

I think the Fed felt this was not the time to be cautious and conservative.