Economic news on Monday, however, suggested that the Fed has the room to cut 50 basis points. The Department of Commerce reported business inventories down 0.3 percent in March, with sales slipping 0.3 percent as well. Declining inventory helps work through the over-production backlog, but continually weak sales is worrisome and a turn in demand is hard to find right now. Also out Monday were April's numbers on capacity utilization, which measures industrial output. Coming in at 78.5 percent, utilization is touching the lows of the 1991 recession.
Layoffs continue to hound newer companies.
Maryland-based Corvis, which makes optical components, announced a plan to reduce its head count by 250 people, or almost 15 percent. Corvis' advanced products have had difficulty gaining traction with customers. But we haven't really seen anything. The company said Monday that it was drastically cutting prices on its Palm VII wireless model. To feels that such a pricing cut would help clear the sales channel by the time Palm introduces a new wireless device in the fall.