One of the most significant comments about the world economy this week may have come from Klaus Kleinfeld, the chief executive officier and president of Alcoa, America’s largest aluminium producer. Amid the reporting of pretty horrible earnings — a $497 million net loss versus a year-earlier gain of $303 million — Kleinfeld said things may not get much worse.
“There are some signs in many of our end industries for a bottoming out,” he said.
A key element was that inventories have been drained across the board, throughout Alcoa’s supply chain, among its customers and among its customers’ customers. They are unsustainably low, Kleinfeld said.
That is the kind of thing to lift the spirits of anyone seeking signs of future demand in the economy. Not only is it rare these days for an industrial company’s CEO to find anything positive to say, it also implies that industrial production is primed for a lift.
Unless, of course, it means that everything is about to come to a grinding halt