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Private Company Index Reflects Markets' Downturn While Showing Strength in the Private Sector
Chicago, IL – August 17, 2007 – Although the July Private Company Index (PCI) does mark a decrease in performance from this sector, Index Managers caution that this is not to be seen as a sympathetic reflection to the state of the financial markets. The 5.85% slide, which lands the Index at 740, is in fact a seasonal event that is charted annually in July. In contrast to all the woe surrounding capital markets this month, the PCI team offers the bright news that the July 2007 downturn was 32% less severe than seen in July 2006, making for a very healthy Index year.
Entrex founder and CEO, Stephen H. Watkins, shares his views, “This is the ideal time for people to pay attention to the fact that the PCI measures business activity and performance on Main St. and not Wall St. Businesses and consumers are purchasing goods and services from private companies all over North America. The PCI’s portfolio is a far more accurate indicator of the U.S. economy than the volatile trading markets which reflect trading sentiment versus the PCI’s economic activity measurement.”
In a recent Bloomberg interview St. Louis Federal Reserve Bank President, William Poole, agreed that the U.S. economy is not undermined by this latest market activity. “It’s premature to say that this upset in the market is changing the course of the economy in any fundamental way” he states. And goes on to say that he doesn’t see any evidence that this capital market affect is spreading to the broader consumer segments of the markets.
In slight contrast, Treasury Secretary Henry Paulson was quoted by the Wall Street Journal this week as saying the market turmoil “will extract a penalty on the growth rate” of the U.S. economy. However, he softens that view greatly with a Fortune magazine article to be published today in which he states, “The overall economy and the market are healthy enough to absorb all this.”
Entrex supports Paulson and his efforts to strengthen U.S. markets and our overall economy in controlled and globally strategic ways. In July 9 comments to the Treasury, Watkins calls to light that “it is…private companies, and investors looking to gain from their growth, which create the system that will maintain the U.S.’s status as a global leader on the business forefront.”
About Private Company Index (PCI):
Sponsored and administered by Entrex, Inc. (www.entrex.net) the PCI is a proprietary benchmarking tool used to measure overall performance growth, and decline, in the private sector. It is recognized as the most authoritative source on sector performance by practitioners in the financial markets.
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