It's a pretty straightforward case of weak equities helping bonds. But there's still the feeling that we're running up against some kind of a brick wall, and that's why prices were unable to push a whole lot higher.

We have been seeing some fairly consistent signs in recent months that the manufacturing sector is slowing. Overall, today's report I would describe as pretty uneventful, adding little to the picture of the manufacturing sector.

This is the moment of truth for productivity, to see what part of those stunning gains of the previous three years had been related simply to the cyclical part of the whole story, and which part of those gains represented underlying increases in productivity trends. Right now, there are some questions being raised.

[The index] raises the issue of whether the consumer, which up until now had been hanging in there pretty well, is starting to break up, and I think that is going to prove a critical issue in the next several months.

There's a strong view that it will be very hard to push two-year yields below 1.75 percent in a significant way without a development that could keep the Federal Reserve from raising interest rates until the end of next year or 2005, so we're stalling a bit.

All these things worked together to cause the market turnaround. There was a sense that the selling had been way, way overdone beyond any rationale. The economy is still weak and the Fed is going to ease.

The data were the latest of several recent reports, including ones on jobless claims and consumer confidence earlier this week, that told us that the economy is not out of the woods yet.

For the past few months, core C.P.I. has been surprisingly well behaved. You would be very hard-pressed to find such a long stretch of benign numbers.

The key is whether consumers' income will be able to keep up, and that looks encouraging so far.