Economic Reports Tell Mixed Story on Eve of GDP Report

Last fall gave way to the winter of our discontent over all things economic, and now we're in the midst of an autumn of muted hope: You may see the leaves as at the most colorful in their life cycle -- or as withering and falling once again.

The latest sign of economic rebirth came today in September's orders for durable goods, a.k.a. long-lasting products from airplanes and construction equipment to appliances, furniture and GPS devices. Such orders rose for the fourth month in six, rebounding from a 2.6% drop in August, the U.S. Commerce Department reported this morning.

Like consumer confidence, durable-goods orders hint at the mood and sense of security among corporate and individual buyers, since they involve larger financial outlays and a degree of spending discretion. If a construction company's shelling out for a big-ticket item like a crane or a bulldozer, it is in expansion mode. If a consumer drops three grand on a new living-room set, he or she has grown more confident the layoff wave is ebbing and won't hit home.

Add all those big-ticket, discretionary purchases up and they factor mightily into a nation's Gross Domestic Product, the total output of goods and services both private and public. And with that, another sign of the scope of rebirth is being released tomorrow to high anticipation -- the U.S. GDP growth estimate for the July-through-September quarter.

And the muted hope? It's evident in sudden attacks of the nerves that haunt us in uncertain times. The latest today hit Goldman Sachs, one of the few surviving, independent, Wall Street investment-banking giants.

Goldman cut its third-quarter GDP growth estimate to 2.7% from 3% on the eve of the report's release specifically because the durable-goods report wasn't as strong as it expected. Due to a single, monthly economic reading within a three-month period that produced scores of such reports, Goldman reduced its projection for the entire U.S. economy.

A second report later this morning on new home sales for September supported Goldman's dimmer view. It showed an unexpected 3.6% drop from August.

So now it's onto tomorrow's GDP reading and another barometer of whether and to what degree, as Alexander Pope wrote in 1733, "hope springs eternal."