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Confidence Is Growing That Economic Pickup Is Real Deal This Time; Stocks, Latest Data Say Yes; But two links are missing: rebound in factory output and expansion of payrolls.(A)

Investor's Business Daily

| December 02, 2002 | COPYRIGHT 2002 Investor's Business Daily, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

Byline: CHRISTINA WISE

First-time jobless claims dipped to a 21-month low. Third-quarter GDP came in at a healthy 4%. The manufacturing sector is showing signs of life, and durable goods orders seem to be coming back.

Meanwhile, consumer confidence bounced back in November and inflation has stayed tame, despite easy and cheap money.

Even the stock market seems to be perking up. The S&P 500 has pulled ahead more than 22% from its October lows and is in its best rally in a year. Credit spreads have narrowed and corporate profits seem to be on the mend.

All in all, it seems the economic spark has been lighted -- or relighted depending on perspective.

"I think we're emerging from the soft spot," said Tony Crescenzi, chief bond market strategist for Miller, Tabak & Co. in New York. "There's still some ground to make back, but it looks like it's occurring rather quickly."

In addition to the firming job market, the factory rebound and bolstered consumer confidence, he says, a massive level of refinancing activity should also help feed the fledgling recovery.

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