Economic Outlook Highlights Archive

Gary Schlossberg is Wells Capital Management’s senior economist. His publications assess the economic environment and financial markets in order to provide expert insight to our investment teams and a broader understanding to our clients. Below is a collection of his Economic Outlook Highlights—brief, bullet-pointed summaries and outlooks of timely economic factors along with issues affecting stocks and bonds.

December 2018     |  Economic and Financial Outlook Highlights   (PDF/New Window)
December 2018    |  Economic and Financial Outlook Highlights  (PDF/New Window) December 2018 | Economic and Financial Outlook Highlights
Moderating economic growth is set to stabilize at an adequate— if not respectable—2%-2.5% in the coming year, as the decade-long expansion continues its assault on a June 2019 longevity record. Added support to consumer-centric growth is coming from an accelerated pace of late-cycle, state and local government spending, and from housing's anticipated "mini"-revival amid recent mortgage rate declines and improved "affordability" conditions.
September 2018   | Economic and Financial Outlook Highlights  (PDF/New Window)
September 2018  |  Economic and Financial Outlook Highlights  (PDF/New Window) September 2018 | Economic and Financial Outlook Highlights
Weakening housing and foreign trade are in the vanguard of a shift to more moderate 2.5%—3.5% growth, reinforced in the coming months by a wind-down of fiscal stimulus, rising oil costs, plus trade protectionism’s dampening effect on the growth of world trade and U.S. exports.
August 2018   | Economic and Financial Outlook Highlights  (PDF/New Window)
August 2018  |  Economic and Financial Outlook Highlights  (PDF/New Window) August 2018 | Economic and Financial Outlook Highlights
Third-quarter economic growth is on track for above-average 3% to 4% atop a 4% second-quarter pace, signaling back-loaded strength increasingly common in recent growth cycles. Strength in consumer spending and investment is countering drag from widening trade deficits and housing’s affordability squeeze from firmer mortgage rates.
April 2018   | Economic and Financial Outlook Highlights  (PDF/New Window)
April 2018   |  Economic and Financial Outlook Highlights  (PDF/New Window) April 2018 | Economic and Financial Outlook Highlights
Deferred business spending and recent investment-oriented tax cuts will continue to reinforce a typical late-cycle rotation toward investment-led growth during the balance of the year. The consensus second-quarter growth forecast is centering on 2.8%—3% early in the period, up from the first quarter’s better-than-expected 2.3% rate. Solid gains in inflation-adjusted income and profits, rising operating rates and job-market confidence are among spending’s drivers supporting second-half growth close to its second-quarter pace during the latter part of the year, out-weighing slower growth abroad, plus a squeeze on housing affordability and household wealth.
February 2018   | Economic and Financial Outlook Highlights  (PDF/New Window)
February 2018   |  Economic and Financial Outlook Highlights  (PDF/New Window) February 2018 | Economic and Financial Outlook Highlights
The return to a more normal economic cycle, including inflation-driven increases in interest rates, is setting the stage for a long-overdue rotation from credit-sensitive housing and big-ticket consumer spending to late-cycle business investment. Countering expanded recession risks from sustained inflation and interest-rate increases are the economy's broad-based strength and still-lax financial conditions supporting economic growth of 2-1/2%-3% this year and 2%-2-1/2% in 2019.
January 2018   | Economic and Financial Outlook Highlights  (PDF/New Window)
January 2018   |  Economic and Financial Outlook Highlights  (PDF/New Window) January 2018 | Economic and Financial Outlook Highlights
Tax reform, synchronized growth abroad, and a solid, well-balanced pace of domestic spending have tilted growth prospects to the upper end of the 2.5%-3% range expected for this year. Its breadth is fast becoming a defining feature of this growth cycle, supported to an unusual degree by early-cycle, "big-ticket" consumer spending and housing propelled by subdued inflation and by historically low interest rates.
December 2017   | Economic Outlook Highlights  (PDF/New Window)
December 2017   |  Economic Outlook Highlights  (PDF/New Window) December 2017 | Economic Outlook Highlights
Tax cuts increase the chances of economic growth next year in the 2.5%-3.0% range from 2017's estimated 2.3% rate. Support will depend, in part, on the ripple effects of fiscal stimulus throughout the economy. Sustaining broad-based strength behind a "mini"-burst of activity will depend partly on the economy's ability to overcome a recent squeeze on household "purchasing power" and late-cycle limits to "pent-up" demand, and to reinforce an investment recovery driven more by sales growth and capacity pressures than by the after-tax return on investment.
November 2017   | Economic Outlook Highlights  (PDF/New Window)
November 2017   |  Economic Outlook Highlights  (PDF/New Window) November 2017 | Economic Outlook Highlights
The economy is on track for a third straight quarter of healthy, 3.0%-3.5% growth based on early returns, supported by post-hurricane reconstruction and related spending, synchronized global growth boosting overseas sales and by broadening strength to business investment. Activity is expected to moderate to a still-acceptable 2.0%-2.5% rate, typical late in a growth cycle, as reconstruction winds down in 2018.
October 2017   | Economic Outlook Highlights  (PDF/New Window)
October 2017   |  Economic Outlook Highlights  (PDF/New Window) October 2017 | Economic Outlook Highlights
The economy is on track for a third straight quarter of healthy, 3%-3.5% growth based on early returns, supported by post-hurricane reconstruction and related spending, synchronized global growth boosting overseas sales and by broadening strength to business investment. Activity is expected to moderate to a still-acceptable 2%-2.5% rate, typical late in a growth cycle, as reconstruction winds down in 2018.
September 2017   | Economic Outlook Highlights  (PDF/New Window)
September 2017   |  Economic Outlook Highlights  (PDF/New Window) September 2017 | Economic Outlook Highlights
A hurricane-related growth recovery in coming months will be supported by reconstruction, replacement demand and deferred spending by businesses and consumers, following losses shaving an estimated 0.5%-0.75% from a third-quarter pace now put at about 2%.
August 2017   | Economic Outlook Highlights  (PDF/New Window)
August 2017   |  Economic Outlook Highlights  (PDF/New Window) August 2017 | Economic Outlook Highlights
The economy's growth recovery has extended into the third quarter, judging from "real-time" estimates clustered in (but not confined to) a 2.5%-3.5% range atop the spring period's respectable 2.6% rate.
July 2017   | Economic Outlook Highlights  (PDF/New Window)
July 2017   |  Economic Outlook Highlights  (PDF/New Window) July 2017 | Economic Outlook Highlights
The economy is on track for growth close to its 2.6% second-quarter rate through the end of this year. Remarkably low recession risks for an eight-year expansion primarily reflect interest rates suppressed by ample "liquidity" and subdued inflation plus broad-based, manufacturing and non-manufacturing support to growth.
June 2017   | Economic Outlook Highlights  (PDF/New Window)
June 2017   |  Economic Outlook Highlights  (PDF/New Window) June 2017 | Economic Outlook Highlights
Moderate, 2%-2.5% growth likely will be sustained, on average, through the end of the year, sandwiched between support from housing, business investment and, to a lesser extent, consumer spending versus restraint from structural and atypical late-cycle weakness in commercial construction, state, and local spending. Unusual late-cycle fiscal stimulus, even if successful in navigating a polarized Congress, risks boosting inflation more than economic growth, or simply failing to lift consumer spending, hiring, and investment.
May 2017   | Economic Outlook Highlights  (PDF/New Window)
May 2017   |  Economic Outlook Highlights  (PDF/New Window) May 2017 | Economic Outlook Highlights
A growth recovery of uncertain strength from a disappointing first quarter. Support from leading-edge housing and solid job growth is countering increasingly mixed manufacturing data and an auto-led slowdown in the pace of consumer spending, poised to revive with improving income growth. Mixed, but generally supportive financial barometers of the economy's health include strengthening lending activity and ongoing improvement in financial stress indicators here and abroad amid a "flattening" yield curve symptomatic of slowing growth.
First Quarter 2017   | Economic and Investment Commentary (PDF/New Window)
Fourth Quarter 2016   |  Economic and Investment Commentary (PDF/New Window) First Quarter 2017 | Economic and Investment Commentary
Late-cycle transitions. Growth through March made this economic expansion the third longest on record, less a tribute to its underlying strength than to sluggishness preventing the usual bottlenecks driving inflation and interest rates high enough to squeeze housing and other credit-sensitive sectors. Unusually enduring support to economic growth has come from early-cycle housing, autos and other "big-ticket" consumer spending, supported by gains in household wealth, low mortgage rates, and ample credit. However, doubts have been raised over a second-quarter growth recovery to adequate, if not respectable 2%-2.5% growth from the estimated 1%-1.5% rate during the opening months of the year by disappointing activity data early in the period. Outlook uncertainties have been raised by disappointingly modest gains in March jobs and retail sales, inflation's broad-based slowdown that month, reduced manufacturing growth in early-April plus "yellow flags" from slowing loan growth and a narrowing gap between shorter and longer-term rates often foreshadowing a slowing economy.
March 2017 | Economic Outlook Highlights (PDF/New Window)
March 2017  |  Economic Outlook Highlights (PDF/New Window) March 2017 | Economic Outlook Highlights
The truth probably lies somewhere between a seeming disconnect between "real-time" first-quarter growth estimates of about 1% and solid underlying data now clouding the outlook for inflation, interest rates, and corporate profits. Underlying themes supporting a return to respectable, 2.5% growth remain intact, including consumer and housing-led growth contributing to strength in manufacturing, despite weak international competitiveness, and strength extending to late-cycle business investment.
February 2017 | Economic Outlook Highlights (PDF/New Window)
February 2017  |  Economic Outlook Highlights (PDF/New Window) February 2017 | Economic Outlook Highlights
Recent momentum could carry economic growth beyond the projected 2.5% first-quarter rate, on strengthening manufacturing activity into early February and on housing's support drawn increasingly from past underbuilding, as rising mortgage rates eat into "affordability." Consumer-led growth is poised for a delayed rotation toward late-cycle business investment, on faltering (but still vibrant) auto sales and pressure on "real" incomes.
January 2017 | Economic Outlook Highlights (PDF/New Window)
January 2017  |  Economic Outlook Highlights (PDF/New Window) Janaury 2017 | Economic Outlook Highlights
Balanced, respectable growth of about 2.5% is the message coming from data at the turn of the year, sufficient for added declines in unemployment and multiple rate increases this year by the Federal Reserve.
Fourth Quarter 2016  | Economic and Investment Commentary (PDF/New Window)
Fourth Quarter 2016   |  Economic and Investment Commentary (PDF/New Window) Fourth Quarter 2016 | Economic and Investment Commentary
A transformative year for the economy... The fourth quarter of 2016 marked the end of a year as transformative as it was surprising, a pattern that could continue this year. Capturing most of the attention was the unexpected, ranging from renewed financial turbulence in China at the start of last year, to the mid-year "Brexit" vote, and to the November election results in the U.S. However, less apparent, more fundamental changes have the potential to spawn sea changes shaping economic and investment performance this year and beyond. First, the economy has emerged from the financial "meltdown" and its after-"shocks" signaled by re-leveraging, a housing mini-"boom" and a turn from debilitating "disinflation" all leaving activity better positioned for a successful transition from aggressive monetary stimulus to greater fiscal support and business-"friendly" regulations. Second, the election raised the prospect of another fundamental shift in the tax and regulatory environment, toward a more business-"friendly," market-driven approach. Third, and less constructive, has been an accelerated move toward "de-globalization," beyond mere disgruntlement toward a realignment of the political power balance in Europe and in the U.S.
December 2016 | Economic Outlook Highlights (PDF/New Window)
December 2016  |  Economic Outlook Highlights (PDF/New Window) December 2016 | Economic Outlook Highlights
Year-end growth at a respectable, but unspectacular 2.5% rate is expected to be sustained, on average, through 2017. The economy will be caught between late-cycle restraints and re-emergence of an "old normal" economy, moving beyond the financial "meltdown's" after-"shocks," and more receptive to fiscal and regulatory support.
November 2016 | Economic Outlook Highlights (PDF/New Window)
November 2016  |  Economic Outlook Highlights (PDF/New Window) November 2016 | Economic Outlook Highlights
Market reaction to surprising U.S. election results capped an ongoing shift from a "liquidity"-driven rally in the asset markets, encouraging a reach for yield and return, to a "reflation" trade centered on more highly charged, economically sensitive investments.
Third Quarter 2016  | Economic Outlook Highlights (PDF/New Window)
Third Quarter 2016   |  Economic Outlook Highlights (PDF/New Window) Third Quarter 2016 | Economic Outlook Highlights
An "old-man-river" growth cycle? The economy headed into the "gun-lap" quarter of 2016 overcoming a brief summer "soft patch" in returning to 2.5%-3% growth in the July-September period, adequate enough for further declines in unemployment and for a re-start to interest-rate "normalization" by the Federal Reserve. Activity likely will shift to a more sustainable 2%-2.5% pace over the next twelve months, a sweet spot exceeding stall speed but short of creating bottlenecks raising inflation, interest rates and the threat of a recession. Above-average income growth, confidence levels at a 10-year high and historically low mortgage rates are the kind of spending "drivers" needed to extend this growth cycle—soon to be the fourth longest since the end of World War II, into a ninth year. Investment spending’s extended slump showed signs of bottoming in the summer, too, in posting the first three-month growth of capital-goods orders since last October. Glimmers in the foreign trade outlook, a likely Achilles heel for the economy through much or all of next year, appeared in the summer with a first increase in global market share of exports since February.
September 2016 | Economic Outlook Highlights (PDF/New Window)
September 2016  |  Economic Outlook Highlights (PDF/New Window) September 2016 | Economic Outlook Highlights
Spending’s "drivers"—capped by accelerated gains in household "purchasing power"—should support a growth revival sometime in the fourth quarter from a late-summer slowdown, the latest in a stop-go pattern characterizing this recovery/expansion since its start in mid-2009. Still, this latest "soft patch" could leave the economy’s late-2016 pace short of its projected 2%-2.25% rate, following front-loaded, 2.5%-3% third-quarter growth.
August 2016 | Economic Outlook Highlights (PDF/New Window)
August 2016  |  Economic Outlook Highlights (PDF/New Window) August 2016 | Economic Outlook Highlights
Economic growth in the second half is set to maintain its estimated 2.5%-3% third-quarter rate through late August from dismal, sub-1% first-half growth, paced by consumer spending and housing, with added support from a mild recovery in trade-sensitive manufacturing, and less “drag“ from stabilizing investment spending.
July 2016 | Economic Outlook Highlights (PDF/New Window)
July 2016  |  Economic Outlook Highlights (PDF/New Window) July 2016 | Economic Outlook Highlights
The economy’s quarter-end momentum has left it well-positioned to sustain through the summer estimated springtime growth of 2.5%, adequate enough for further inroads against unemployment and, by itself, a return to interest-rate hikes by the Federal Reserve. Unbalanced growth between housing- and consumer-led strength vs. lagging performance by trade sensitive manufacturing and business investment will leave the economy vulnerable to “shocks” or to more of the stop-go pattern evident throughout this seven-year expansion.
Second Quarter 2016 | Economic Outlook Highlights (PDF/New Window)
Second Quarter 2016  |  Economic Outlook Highlights (PDF/New Window) Second Quarter 2016 | Economic Outlook Highlights
Into a critical second-half 2016. Respectable, second-quarter growth of 2.5%-3% from a now-familiar, early-year stumble lifted outlook confidence ahead of what could be a defining period for the asset markets. At issue for an earnings-driven recovery in stocks are increases in closely allied unit sales needed to counter margin pressure and, perhaps, dollar strength blunting multinationals' translated foreign income. The broader issue for assets is the risk of higher interest rates from economic growth and less sanguine inflation expectations overcoming strong foreign demand for U.S. securities and Fed policy inertia. Second-half growth, projected at 2%-2.5%, will face headwinds from an aging, seven-year growth cycle, lingering fall-out from the 2008-09 “meltdown” and from structural weaknesses centered on disappointing labor-force and productivity growth. The economy risks being handicapped, as well, by unbalanced growth. A widening performance gap between leading-edge housing and consumer spending vs. trade- and oil-related weakness in manufacturing and business investment is being aggravated by "Brexit's" downward pressure on U.S. interest rates and its lift to the dollar.
May 2016 | Economic Outlook Highlights (PDF/New Window)
May 2016  |  Economic Outlook Highlights (PDF/New Window) May 2016 | Economic Outlook Highlights
The economy’s mid-quarter strengthening has increased the chances for a growth recovery to 2%-2.5% (about its estimated long-term potential) from less than 1% during the opening months of the year—a pace expected to be maintained, on average, into 2017.
First Quarter 2016 | Economic Outlook Highlights (PDF/New Window)
First Quarter 2016  |  Economic Outlook Highlights (PDF/New Window) First Quarter 2016 | Economic Outlook Highlights
From divergence to convergence. A shift from economic divergence to convergence characterized first-quarter activity in the U.S. as clearly as it did Fed policy in the global context, against a backdrop of disappointing growth typical of this 6.5-year growth cycle. Manufacturing’s slow recovery from a months-long recession accounted for much of that convergence, lifted by a weaker dollar and progress toward trimming excess inventories. That, combined with a slowing pace of non-manufacturing activity during the opening months of the year netted to first-quarter growth of 1%, or less, from an equally tepid, 1.4% rate during the closing months of last year. An auto-led slowing of consumer-spending growth faced head winds from rising gasoline prices (back to a late-November high by early April), still-moderate wage gains and an up-and-down stock market doing little to boost household wealth. That put the ball more firmly in the court of housing and its sizable ripple effect on other parts of the economy to carry growth through mid-year. Overseas weakness, fall-out from earlier dollar strength and oil-industry spending cuts have been most responsible for weak exports and investment spending, still the economy's two biggest weak spots.
February 2016 | Economic Outlook Highlights (PDF/New Window)
February 2016  |  Economic Outlook Highlights (PDF/New Window) February 2016 | Economic Outlook Highlights
The economy’s return to moderate, 2%-2½% growth from near-stagnation during last year’s fourth quarter remains highly unbalanced between manufacturing weakness and more acceptable non-manufacturing activity.
Fourth Quarter 2015  | – Economic and Investment Commentary (PDF/New Window)
Fourth Quarter 2015  2015 | – Economic and Investment Commentary (PDF/New Window) Fourth Quarter 2015 | Economic and Investment Commentary
What kind of transition year? The economy is midway through the seventh year of an unusually long growth cycle, still grappling with structural weaknesses, the 2008-09 financial "meltdown’s" lingering effects, and the more immediate implications of a harsh global environment. Second-half growth likely slowed to less than 2%, masking a widening gap between consumer- and housing-led strength vs. a manufacturing recession propelled by oil-industry spending cuts, weak overseas markets and dollar strength reducing U.S. export competitiveness to a 12-year low. This "split personality" economy has carried over to inflation, where increases in domestic-driven services prices at a seven-year high sit astride "deflation" (or declining prices) for trade-sensitive manufactured goods reinforcing steep declines in fuel costs. Domestic strength and trade-related weakness should keep this year’s growth in line with the 2%-2.5% rate in 2015, the lower end of the range barely adequate to support a labor-market recovery and further rate increases by the Federal Reserve.
Third Quarter 2015  | – Economic and Investment Commentary (PDF/New Window)
Third Quarter 2015  2015 | – Economic and Investment Commentary (PDF/New Window) Third Quarter 2015 | Economic and Investment Commentary
"Disinflation’s" enduring shadow. A gathering slowdown in the pace of third-quarter activity may have left growth at 2% or less for the period from an impressive 3.9% rate in the spring, still led by housing and consumer spending out-weighing more modest growth in manufacturing and in the economy’s other trade-sensitive sectors. Tempering worries over slowing, uneven growth have been signs of a more normal and, hopefully, resilient growth cycle. Leading-edge strength in "big-ticket," discretionary housing and auto sales has been propelled by higher levels of confidence, income growth and credit availability, the last of these finally growing at an above-average pace after extended years of sluggishness. These, plus adequate job growth and solid increases in household formations are signs of adjustment to financial turmoil, hopefully providing resilience to ongoing "shocks" contributing to moderate, stop-go growth in the past six years. Tailwinds supporting housing and consumer-led growth—ranging from moderate income gains and low fuel costs to lower mortgage rates and still-solid housing "affordability"—can support growth of 2½%-3% well into 2016. That’s sub-par after the deep, 2008-09 recession but still adequate enough for further inroads against unemployment and, by itself, for a first rate increase by the Federal Reserve.
June 2015 | Economic Outlook Highlights (PDF/New Window)
June 2015 | Economic Outlook Highlights (PDF/New Window) June 2015 | Economic Outlook Highlights
The latest "go" phase of frustrating, "stop-go" growth suggests a slow return of the business cycle from the aftermath of the 2008-2009 financial upheaval and with it, the prospect of more satisfactory, 2½%-3% growth.
May 2015 | Economic Outlook Highlights (PDF/New Window)
May 2015 | Economic Outlook Highlights (PDF/New Window) May 2015 | Economic Outlook Highlights
Strengths in recent data are positioning the economy for minimum, 2½%-3% growth into 2016 necessary for adequate job growth and for an interest-rate "up cycle." Leading-edge housing and lagging manufacturing are bracketing disappointing consumer spending, keeping this year’s growth recovery well short of that a year ago.
April 2015 | Economic Outlook Highlights (PDF/New Window)
April 2015 | Economic Outlook Highlights (PDF/New Window) April 2015 | Economic Outlook Highlights
A springtime growth recovery is coming in short of the expected 2½%-3% pace needed to support interest-rate increases by the Fed later this year. Trade sensitive manufacturing continues to struggle against top-heavy inventories, a strong dollar’s impact on global competitiveness, and generally weak conditions abroad. More surprising has been the failure of consumer spending and housing to parlay generally strong "fundamentals" into more satisfactory growth.
March 2015 | Economic Outlook Highlights (PDF/New Window)
March 2015 | Economic Outlook Highlights (PDF/New Window) March 2015 | Economic Outlook Highlights
The economy is hinting at improvement in the approach to the second quarter from sluggish, sub-2% growth during the opening months of the year. Yet another spring-summer "bounce" in economic activity supported by solid "drivers" of consumer spending risks being diluted, however, by a worsening foreign trade deficit that keeps growth closer to 2½% than to the 3% expected earlier.
February 2015 | Economic Outlook Highlights (PDF/New Window)
February 2015 | Economic Outlook Highlights (PDF/New Window) February 2015 | Economic Outlook Highlights
The economy is set to regain momentum after stumbling early this year, as inventory adjustment weighing on manufacturing winds down and consumer spending is propelled by solid jobs gains and by lower fuel costs. Economic growth is set to accelerate to a 10-year high of 3%, or more, despite "headwinds" from a worsening foreign trade deficit and from housing’s still-disappointing recovery.
Fourth Quarter 2014 | Economic And Investment Commentary (PDF/New Window)
Fourth Quarter 2014 | Economic And Investment Commentary (PDF/New Window) Fourth Quarter 2014 | Economic And Investment Commentary
An island of strength. The U.S. economy has been among the few achieving satisfactory, self-sustaining growth in the past year, a prerequisite for rooting out lingering weakness in the labor market. Consumer-led strength, igniting healthy gains in manufacturing earlier this year, propelled activity to its strongest back-to-back pace since 2003 during the second and third quarters of 2014. Leading-edge strength in the global economy, reminiscent of our traditional "locomotive" role, likely will have a more muted international impact now than in decades past, as our shrinking share of the world market and still moderate growth outweigh any lift to foreign firms’ market share from a strengthening dollar and reduced U.S. competitiveness. In fact, more recent economic data have signaled a shift to still respectable, 3% growth in the fourth quarter from the 5% rate in the July-September period, restrained by a slower pace of manufacturing and by a still lackluster housing recovery.
December 2014 | Economic Outlook Highlights (PDF/New Window)
December 2014 | Economic Outlook Highlights (PDF/New Window) December 2014 | Economic Outlook Highlights
The economy is better-anchored now than at any time since the recession ended in June 2009 to satisfactory, self-sustaining growth of nearly 3%, propelled by a broadening array of economic "drivers" supporting consumer spending, housing and business investment.
November 2014 | Economic Outlook Highlights (PDF/New Window)
November 2014 | Economic Outlook Highlights (PDF/New Window) November 2014 | Economic Outlook Highlights
The economy is on track for moderate, but uneven growth of 2½%-3% as it heads toward 2015. Lackluster housing and worsening foreign trade are diluting support from moderate gains in consumer spending and from the usual, late cycle rotation of strength toward investment spending.
Third Quarter 2014 | Economic And Investment Commentary (PDF/New Window)
Third Quarter 2014 | Economic And Investment Commentary (PDF/New Window) Third Quarter 2014 | Economic And Investment Commentary
Back on track. The economy is on the threshold of satisfactory, self-sustaining growth after more than five years of a disappointing, stop-go recovery, a point underscored by a September employment report strong enough to lift rolling, six-month job gains back to a cycle peak averaging 245,000 a month. Purchasing-manager surveys of manufacturing and non-manufacturing activity signaled moderately strong growth through September, auto and other retail sales have been gathering momentum, and even exports have overcome slowing overseas growth and the effect of a strengthening dollar on international competitiveness, at least for now. Equally important, accelerating, double-digit growth of equipment orders is signaling a typical late-cycle rotation of strength from consumer spending to business investment.
October 2014 | Economic Outlook Highlights (PDF/New Window)
October 2014 | Economic Outlook Highlights (PDF/New Window) October 2014 | Economic Outlook Highlights
Consumer spending and investment are capable of sustaining economic growth at a near-3% rate into 2015 despite a threatened "spillover" to the U.S. from dollar strength and from worsening conditions abroad, supported by key "drivers" of domestic spending and adjustment to the after-effects of the 2008-2009 financial "meltdown."
September 2014 | Economic Outlook Highlights (PDF/New Window)
September 2014 | Economic Outlook Highlights (PDF/New Window) September 2014 | Economic Outlook Highlights
Chances for satisfactory, self-sustaining growth of 2½-3% this year and into 2015 are better now than at any time during this five-year growth cycle. Adjustment to the financial "meltdown’s" imbalances, including household and bank "de-leveraging," bank re-capitalization and reduced cash hoarding have combined with reasonably good strength in growth’s drivers to extend the expansion into a longer-than-average sixth year.
July 2014 | Economic Outlook Highlights (PDF/New Window)
July 2014 | Economic Outlook Highlights (PDF/New Window) July 2014 | Economic Outlook Highlights
Economic growth’s "drivers," though still mixed, are capable of sustaining auto- and manufacturing-led growth at the 2½%-3% rate now estimated for the second quarter. Optimism from the solid rise in household wealth, declining fuel costs, strengthening job gains, and double-digit growth of capital-goods orders, recently, is being tempered by disappointing growth of household incomes and by a lackluster housing recovery.
May 2014 | Economic Outlook Highlights (PDF/New Window)
May 2014 | Economic Outlook Highlights (PDF/New Window) May 2014 | Economic Outlook Highlights
Outlook strengths should outweigh April’s mixed economic data in sustaining moderate growth beyond a springtime "bounce" overstated by the release of weather-related "pent-up" demand.
First Quarter 2014 | Economic And Investment Commentary (PDF/New Window)
First Quarter 2014 | Economic And Investment Commentary (PDF/New Window) First Quarter 2014 | Economic And Investment Commentary
Snowbound! The economy was sidetracked from yet another run at satisfactory, self-sustaining growth during the closing months of 2013 by the harshest winter in over fifteen years. First-quarter growth may have slowed to less than 2% from a respectable 3.3% rate during last year’s second half, with weakness most noticeable in weather-sensitive housing, manufacturing, and auto sales. "Yellow flags" in the U.S. economic data combined with a deepening slowdown in China to weigh on emerging markets directly and indirectly, by triggering "flight" capital and currency depreciation in several countries, requiring sizable, growth debilitating interest-rate "hikes" to stabilize conditions. Europe remained calm by comparison, as internal adjustment fostered a modest economic recovery extending to the region’s hard-pressed, "peripheral" economies.

Gary Schlossberg

Senior Economist

Gary SchlossbergAs senior economist, Gary Schlossberg is responsible for assessing the economic environment and providing input to the equity and fixed-income portfolio management teams at Wells Capital Management.

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