Silence can be either the greatest form of wisdom, or the most deafening alarm.
Staring through a tunnel of uncertainty, one of the largest U.S. steelmakers declined to issue fourth-quarter guidance despite reporting record earnings. Nucor
As with last week's similarly positive results from steelmakers POSCO
Let's listen to Nucor's sound of silence: "There is little forward visibility on either the economy or our industry, even for the fourth quarter. These conditions are such that financial projections are not practical." Obviously, when major players in a bellwether industry are unable or unwilling to forecast industry conditions even for a quarter in progress, economic uncertainty has reached critical boiling point. I also hear whispers from Nucor's balance sheet, which indicates sizable debt, inventories, and goodwill, though with those acquisitions, this isn't too surprising. Just keep an eye on it.
Echoed in the wells of silence
Considering the alarm bells of recent production cuts from steel and aluminum giants like ArcelorMittal
For those standing pat with battered positions, Nucor's silence contained a welcome caveat: "What we can say is that 2008 will be another record year for Nucor and today our competitive position is stronger than ever, both here and globally. ... We are still strong believers in the long-term strength of the global infrastructure build and the associated bull market for steel." I share that long-term outlook, and look to China's now-sputtering growth with some measure of hopefulness. On Nucor's near-term prospects, however, I too shall remain silent for now.