From the July-August 2010 issue of Treasury & Risk magazine

Keeping Expectations Real

Optimism about the U.S. economic outlook took a tumble recently amid reports showing employment gains may be petering out, the housing sector is still weak, and manufacturing has cooled. Joel Naroff of Naroff Economic Advisors dismisses the speculation about a double-dip recession and says the economy is working its way toward a new, more subdued, rate of growth. Craig Thomas of PNC Financial Services Group argues that companies' need to invest in capital expenditures will provide the basis for a healthy recovery. Ward McCarthy of Jefferies & Co. notes that when the Federal Reserve starts to tighten policy, the unwinding of the massive securities purchases it made during the financial crisis is likely to steepen the yield curve.

Watch for the Fed's Portfolio Moves

By Ward McCarthy
Chief Financial Economist & Managing Director
Jefferies & Co.


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