Cisco Systems rocked the stock market yesterday, with a big miss on estimated earnings and an announcement that the coming quarters would basically suck.Why is this a big deal?
Well, Cisco noted that public sector spending would not meet projections, and would not be robust for a long time. That bad news hits the core of the argument that "infrastructure" spending, laregely stimulated by government investment, would be strong, and would benefit firms such as Cisco.
Further, Cisco estimated that state and local tax revenues would not reach "pre-Lehman" levels for another five years. Ouch. That's one year after President Obama's presumed re-election. I emphasize the word "presumed."
The Bloomberg story, included in today's Washington Post, has the details.
Of course, the lurking story is the "recovery" from the Great Recession that no one except financial cheerleaders and those with a vested interest in boosting Manhattan real estate values has detected. Never mind how the cheerleaders haven't defined where the money will come from to pay for what's owed, and what's needed.
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