2009 Forecast – New Equipment

Forecast Accuracy

Historical Machine Tool Consumption

Machine Tool Demand Curve

Fed Funds Rate Leads Consumer DG Spending

Household Debt Leads Consumer DG Spending

Avg. Hourly Earnings Leads Consumer DG Spending

Consumer DG Spending Leads Consumer DG Production

Consumer DG Production Leads Machine Tool Unit Sales

Real Consumer Spending Leads Capital Goods Orders

Capital Goods Orders Leads Capital Goods Production

Capital Goods Production Leads Machine Tool Unit Sales

Combined Industrial Production Leads Machine Tool Unit Sales

Metalcutting Categories - % of Budget

Turning Machines and Machining Centers – % of Budget

Overall Metalcutting Spending by Industry Segment

Electronics/Computers – All Sizes, All Operations

Electronics/Computers – 250+ Emp., All Operations

Electronics/Computers – 250+ Emp., HSM

Electronics/Computers – 250+ Emp., HSM, OH

Electronics/Computers – 1-49 Emp., HSM, OH

Metalworking Business Index

Factors to Consider The Dollar The Era of Frugality The Debt Crisis The Government

Fed Funds Rate vs. The Dollar

Factors to Consider The Dollar The Era of Frugality The Debt Crisis The Government

Total Credit Market Debt as a % of GDP

Factors to Consider The Dollar The Era of Frugality The Debt Crisis The Government

One Final Thought Economics in One Lesson – Henry Hazlitt “It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But, it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.” – Murray Rothbard Economics for Real People – Gene Callahan http://mises.org/books/econforrealpeople.pdf Economics in One Lesson – Henry Hazlitt http://www.fee.org/pdf/books/Economics_in_one_lesson.pdf What has Government Done to Our Money – Murray Rothbard http://www.mises.org/books/whathasgovernmentdone.pdf

Contacts Forecasting Tools Steve Kline, Jr. skline2@gardnerweb.com Capital Spending Survey Nancy Eigel-Miller nemiller@gardnerweb.com

Thank You