Although some fog always surrounds the outlook, there is more than the usual amount of uncertainty at this juncture about the economic future. Clearly, many businesses were surprised by the extent of the slowdown in sales late last year, and inventories became uncomfortably high in some sectors.
There also is talk of an overhang of high-tech capital, although quantifying the magnitude of that overhang is very difficult. Some producers of high-tech equipment may have misjudged the short-term demand for such equipment, perhaps, in part, because they assumed that the strength in investment experienced during 1999 and the early part of 2000 would continue.