The experts are certainly confused. They expected a breakthrough revision for the first quarter GDP of +6% or more and got a moderate revision from +4.8% to +5.3% instead. Housing sales were supposed to decline and they went up at the highest rate of the year. Durable goods were expected to be flat, but they plummeted. There's only one thing to remember in all this: ignore the experts' forecasts and just wait for the real data. I'm always asked for forecasts, and while I do have opinions, of course, I much prefer forecasting in a longer time horizon than whatever next month's data release happens to be. As executives, we have to remember that all of these economic data are not forward looking at all. They're historical and are the ripples of decisions made months—and possibly years—ago. Being obsessed with the latest economic data and letting every tiny aspect of decisions hang on them means that you're risking missing the big picture, saving pennies but losing dollars.

Among other data were a strong personal income report (most of the increase eaten up by higher energy costs, higher interest payments, and higher taxes, but at least income was in the right direction). Corporate profits grew by almost 24% compared to the first quarter of 2004 (which was implied by the exceptionally strong tax collections that the Treasury Department reported earlier).

There is still great concern about the future of interest rates. I still think the Fed does not have to raise rates any more, but that they will continue to do so (like the opinion of a Friday-only economist matters to them). Don't rule out a bold move like a half-point increase accompanied by a statement that says “we're done for now.”