Nothing lasts forever, and some recent economic reports suggest the U.S. economy's tumble may be nearing an end. Although GDP contracted 6.3% in the fourth quarter and 5.5% in the first quarter, some analysts think it will resume growing later this year. Treasury & Risk asked economists John Lonski of Moody's Investors Service, David Levy of the Jerome Levy Forecasting Center, and Milton Ezrati of Lord Abbett to discuss some of the key factors in the
outlook for U.S. growth. Inflation warnings will prove unwarranted as high unemployment and weak pay raises are expected to continue for several years, writes Levy. Ezrati sees encouraging signs in the residential housing market signaling the beginning of a modest recovery, while Lonski predicts more tough sledding for consumers but a mildly better corporate credit outlook.
Weak Labor Market Caps Prices