Equipment finance market confidence 50.2, down from 51.5 July index
- In August, 15.6 percent of respondents indicate they believe their company will increase spending on business development activities during the next six months, down from 25.8 percent in July. 81.3 percent believe there will be “no change” in business development spending, up from 71 percent last month, and 3.1 percent believe there will be a decrease in spending, unchanged from last month.
August 2012 MCI Survey Comments from Industry Executive Leadership
Depending on the market segment they represent, executives have differing points of view on the current and future outlook for the industry.
Independent, Small Ticket
“The industry continues to fuel the few areas of the economy that are seeing expansion. Apprehension among small business owners appears to be ever present given world economic affairs, pending elections, and tax code changes. Margin compression continues to be an issue as the availability of capital continues to outweigh demand.” Valerie Hayes Jester, President, Brandywine Capital Associates, Inc.
Independent, Middle Ticket
“We believe demand will continue to be sluggish until after November.” George K. Booth, Chief Executive Officer, Black Rock Capital LLC
Bank, Middle Ticket
“After seven months of growth, equipment capital expenditures are slowing down. Uncertainty with the U.S. economy is the leading reason.” Harry Kaplun, President, Frost Equipment Leasing and Finance
Why an MCI-EFI?
Confidence in the U.S. economy and the capital markets is a critical driver to the equipment finance industry. Throughout history, when confidence increases, consumers and businesses are more apt to acquire more consumer goods, equipment, and durables, and invest at prevailing prices. When confidence decreases, spending and risk-taking tend to fall. Investors are said to be confident when the news about the future is good and stock prices are rising.
Who participates in the MCI-EFI?
The respondents are comprised of a wide cross section of industry executives, including large-ticket, middle-market, and small-ticket banks, independents, and captive equipment finance companies. The MCI-EFI uses the same pool of 50 organization leaders to respond monthly to ensure the survey’s integrity. Since the same organizations provide the data from month to month, the results constitute a consistent barometer of the industry’s confidence.
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