In Their Own Words: How 10 CEOs Feel About the Economy


Economists aren't very good at what they do because they deal mostly with theories and assumptions. Businesses are pretty good at what they do because they deal mostly with customers and competition. If you want to know how the economy is doing, ask the business leaders. They know the reality; they have the scoop.

I recently dug through a pile of conference call transcripts to see what CEOs are saying about the state of the economy. Here are 10 excerpts (all from conference calls that took place in the last 90 days).

Muhtar Kent, CEO, Coca-Cola :

I think essentially in Europe there is a sentiment there that people are beginning to feel that it is not going to get any worse, that there will be some expansion happening as we move forward and sort of just purely fiscal restraint and monetary restraint. So that feeling is beginning to emerge but I think it is going to be long recovery ...

For the rest of the world, whether it's Africa, the youngest billion, Latin America, Eurasia, our Middle East, we see and of course, Asia, Southeast Asia and other parts of Asia, Indian subcontinent, we see growth, we see very disciplined, monetary policy, balanced budgets, good banking system and the consumer is more positive, and so it's modeled, and it's mixed here into United States, we see some signs of improvement.

David Cote, CEO, Honeywell :

So for now, we're cautiously optimistic, but it's just too early to tell what direction the economy is going ... And we're all concerned that, at some point, this thing turns again and turns in the other direction. We just think the smart thing to do now is to stay conservative and stay prepared. There's -- I see very little downside to being prepared for the downside, and that's the way you're just looking at it. And we're saying, "Okay, better to have this in our pocket to be prepared to deal with that downside." If it doesn't happen, well, there is restructuring opportunity, there is let-it-fall-through opportunity, there may be other investments that we'll do. Right now, just because the news looks a little better the last couple of weeks, but we just don't think this is a good time to declare economic victory.

David Steiner, CEO, Waste Management :

Yeah, I don't know about you all, but for about two years from 2010, 2012, when I go overseas particularly to China, it was the only place you'd go where you see cranes on the skyline. Over the last year traveling throughout the United States, I'm starting to see cranes on the skyline again, which I think is a positive sign.

Again, we're not going to call that good times are here again. But I think it's safe to say that we believe what we're seeing is some stability and that we will actually continue to see some modest growth.

Prem Watsa, CEO, Fairfax Financial Holdings:

And the economy, even last quarter, the United States was flat, or down 0.5%. So in spite of QE3, in spite of QE2, QE1, all of that massive stimulus, monitory stimulus, hasn't had much of an impact on the economy. And so we're just thinking that it's a time to be conservative, but we think what happened in the '08, '09, was not like any other economic recession. We mentioned a few times, we think this is a 1 in 50, 1 in a 100-year storm, so you have to be prepared for its after effects. We don't think it just lasted for 3 and 6 months, and so now we can go forward.

Jamie Dimon, CEO, JPMorgan Chase :

I think the American economy -- I said the table is rather well set. Consumers, businesses, housing, small businesses, they're all in pretty good shape.

Samuel J. B. Pollock, CEO, Brookfield Infrastructure Partners:

Entering 2013, we believe that the global economic recovery is beginning to accelerate. Prospects for the U.S. economy have improved as the housing market has finally turned the corner. Also after a relatively weak year, the Chinese economy is showing signs of strengthening.

Mortimer Zuckerman, CEO, Boston Properties:

I think we are looking at the weakest economic recovery in terms of the growth of -- in real final sales, employment housing and organic personal income, not to mention that every measure of consumer and small business sentiment is locked in recession terrain. I guess it's probably fair to state that I'm having trouble seeing the roots of the recovery. In my estimation, there are not too many tools left in the government toolbox. We've had the most stimulative fiscal and monetary policies in our history, deficit spending of about $1.3 trillion this past year and monetary policies that, by their own statements, have put in $85 billion a month into the money supply and yet, these policies have failed to reignite the economy. And whatever growth there is cannot be sustained without reliance on government steroids. This is an economy on major life support with virtually 0 economic momentum, and we still face the risk of a major bump from some unforeseen quarter.

Donald James, CEO, Vulcan Materials:

When we've gone back and looked at the last 5 or 6 construction cycles in the U.S., you always see very robust recovery. This cycle is different in a couple of ways. It has been both longer and deeper than anything we have seen, going all the way back to the depression. So an argument can be made if the slope and length of the downturn is proportional to the slope and length of the upturn, which you can see in all the last 5 recessions, we could have a very long and very robust recovery. We are seeing it in housing. We are beginning to see it in private non-res. And as you know, the vast majority and cyclicality in the heavy construction materials business is in the private sector, and there remains relative stability throughout the downturns on publicly funded projects, although there is some cyclicality there as well due to tax revenue changes. But I think we are cautiously optimistic that we've got a very good run in front of us. It's harder to say when the big turn occurs than that it will occur, but we're -- we believe there's a tremendous upside.

Scott Anderson, CEO, Patterson Companies:

They will, I would say, probably the most positive thing in the last 90 days, as I've talked to customers across the country, talked to a lot of them last night at a big dinner, is just the growing confidence that the economy is recovering, their practices are stable, their cash flow is increasing.

Jeffrey Mezger, CEO, KB Home :

While there's been a few years in the making, housing is becoming a bright spot for the economy, and the industry is once again positioned to play its historical role of being a job creator and leading the national economy into a full recovery. All of our served markets are experiencing positive recovery trends to varying degrees.

The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Just click here to access the report and find out the name of this under-the-radar company.

The article In Their Own Words: How 10 CEOs Feel About the Economy originally appeared on

TMFHousel has no position in any stocks mentioned. The Motley Fool recommends Brookfield Infrastructure Partners and Coca-Cola. The Motley Fool owns shares of Brookfield Infrastructure Partners and JPMorgan Chase. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.