If businesses are still exhibiting cautious behavior, as Federal Reserve Chairman Alan Greenspan suggested last week, it's not evident from a slew of first-quarter conference calls or recent economic data. Prudent investors might consider the implications for April's employment report.

In speaking before the Joint Economic Committee Wednesday, Greenspan seemed to suggest there was no urgency to raise interest rates because "some of the strains that accompanied the difficult business environment of the past several years apparently still linger." Specifically, he said, firms are reluctant to anticipate and prepare for future orders and are similarly cautious in their hiring decisions.

But CEOs from some of the nation's largest companies have been unusually ebullient about the state of the economy recently and several firms have hinted they will increase hiring this year.

In part, the gap between what companies and the Fed are saying reflects the fine line Greenspan must walk during an election year. Despite its mandate for autonomy, the Fed has traditionally shied away from raising rates in the three months before a presidential race is decided. If that reluctance holds, it leaves the FOMC with a rapidly closing window in which to enact a tightening, making the always-thorny task of interpreting Greenspan's intentions that much harder for stock investors.

The difficulty of knowing what Greenspan is planning showed up in last week's stock market price action, and could mute trading at least until the April employment report arrives. Stocks plunged on Tuesday when the Fed chairman told Congress that deflation had receded as a primary Fed concern, regained the ground a day after he said broad-based inflation remains a concern, then eased again Friday. For the week, the major indices ended moderately higher, with an outperforming Nasdaq washing out its losses from a week earlier.

Notably, the last time stocks posted anything approaching a decisive move was in the runup to and aftermath of the March employment report, when the government said payrolls rose by more than 300,000. Since bottoming around 10,000 a week before the number hit, the Dow has tacked on close to 500 points as investors celebrated the arrival of a long-awaited economic rebound.

But what was manna a month ago could easily be poison today: a blowout number might confirm investors' worst fears about the imminence of a rate hike.

A recent survey by the National Association for Business Economics found that business hiring will expand over the next six months, and 53% of respondents said they expect capital spending at their firms to increase this year.

"It appears the world economy will have one of the strongest, broadest recoveries in years," said Jim Owens, chairman and chief executive officer at Caterpillar ( CAT). Owens said his firm will need more people through the remainder of the year to keep pace with volume growth.

Microsoft ( MSFT) Chief Financial Officer John Connors said his firm is "still adding people," noting that "we are in the midst of a corporate recovery."

Meanwhile, General Electric ( GE) CEO Jeff Immelt said economic growth "is continuing at a strong pace," while companies from Yahoo! ( YHOO) to J.C. Penney ( JCP) to Motorola ( MOT) have been increasing their guidance.

Recent economic data also suggest that corporate America is increasingly optimistic about the economic outlook. The government said Friday that durable goods orders surged 3.4% in March after an upwardly revised 3.8% gain in February.

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