HAS THE U.S. ECONOMY BOTTOMED?
May 29th, 2007Morgan Stanley seems to think so. Today Richard Berner, Chief US Economist for the firm, wrote the following:
Four key themes underpin our fundamental case for a resilient economy that shows improvement later this year as the housing recession fades. First, we think gains in jobs and income will be strong enough to support both moderate gains in consumer spending and a rise in thrift. Second, we believe that booming growth abroad will promote a sustained improvement in net exports and thus output and jobs for the first time in two decades. A key reason is that overseas growth has become less dependent on what’s happening in the US economy and is increasingly driven by domestic demand abroad. We think improving US net exports may add up to half a point to US growth and will help promote global rebalancing… And finally, financial conditions are still supportive of growth.
While these factors do not directly impact housing, a stronger economy and improving wage and jobs outlook has got to help.






