Search Copying and distributing are prohibited without permission of the publisher
Email a friend
  • To include more than one recipient, please separate each email address with a semi-colon ';', to a maximum of 5

  • By submitting this article to a friend we reserve the right to contact them regarding Fastmarkets AMM subscriptions. Please ensure you have their consent before giving us their details.

Who’s to blame if 2014 is another mediocre year?

Keywords: Tags  AMM Comment, John Ambrosia, 2014 outlook

“No confidence in this government,” said one respondent to the AMM survey of metal company executives. “We need to make our own best decisions from a business standpoint no matter what Washington does or doesn’t do.”

This sentiment, and others similar to it, were common responses in the survey (see page 10), reflecting a continuing sense among industry leaders that the government is somehow directly responsible for the slow growth in business that surely keeps many of them awake at night.

In fact, more than half of all survey respondents said they believe the business environment in 2014 will be less certain because it is an election year. But there is another viewpoint. “Anyone who blames market conditions on the fact that it is an election year is an idiot,” said another respondent. “Company sales are based upon demand for products.”

So which outlook is closer to the truth? Perhaps some other results of the survey are instructive:

>> More than 80 percent of respondents said that recent events in Washington (surely including the government shutdown, the fiscal cliff near miss and the new health-care law implementation fiasco) made the business environment less certain.

>> By a two-to-one margin, respondents said that growth in the U.S. economy rather than foreign economies will play the most significant role in determining the price of metal products in 2014.

>> Three-quarters of respondents said the domestic economy will not fully turn around until 2015 or later.

The responses suggest a concern about government leadership as the fallout of the Great Recession enters its seventh year. More and more circumstances are beginning to resemble Japan’s so-called “lost decade” of the 1990s, a fate some economists tried to warn us about as Washington began its gridlock five years ago.

I think what we’re hearing from metal executives is similar to what we’re hearing from U.S. citizens overall: Something just doesn’t feel right about where we’re at right now, and the government doesn’t seem to understand that.

Yes, it’s true that the stimulus package should have been bigger, that we should have had at least one massive federal infrastructure program by now and that concern over the debt and deficit are all out of proportion to what historical experience and common sense should be telling us about how economies work. But at a certain level, year after year the “government-is-making-things-uncertain” viewpoint becomes a self-fulfilling prophecy, a distraction that psychologically keeps us from fully working our way out of this mess.

John Ambrosia
Magazine editor

Have your say
  • All comments are subject to editorial review.
    All fields are compulsory.