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3 Reasons for Optimism About American Economy

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Friday, 29 Jan 2016 05:28 AM Current | Bio | Archive


Despite the latest headlines warned about “a day of reckoning” and the end of the “75-year debt supercycle,” there are, however, still plenty of reasons to be optimistic, particularly about the U.S.

Here are three of the latest:
 
(1) Consumers. U.S. consumers are largely unfazed by the latest market turbulence. They don’t expect that it will negatively impact the economy, according to the Director of Economic Indicators at The Conference Board, which compiles the Consumer Confidence Index. It was 98.1 during January, having continued to hover at a cyclical high around 98 for the past six months.
 
Consumers, of course, are benefitting from lower gasoline prices. That’s offset the slow pace of wage growth that some of them have experienced. In any case, more consumers are working as the job market has improved. The percentage of consumers saying that jobs are hard to get edged down to 23.4% during January, nearing its most recent cyclical low of 21.7% during August.
 
(2) Housing. Sales of existing and new homes remain on solid uptrends. The former rose to 5.23 million units last year, the best full year since 2006. In December, sales of previously owned homes jumped 14.7%. Some of that was due to delays in closings from previous months as lenders adjusted to new regulations, which went into effect in October, requiring more disclosures for home buyers on loan costs.
 
Existing home sales represent a larger share of the housing market than new ones, but the latter is a timelier indicator. New home sales were strong for all of 2015 at the best pace since 2007. In December, sales of new homes jumped 10.8% to a 10-month high. New mortgage applications to purchase a home surged during the first three weeks of January.
 
(3) Trucking. The ATA Trucking Tonnage Index rose 1.1% y/y during December. It remains on a solid uptrend and is near a record high.

Dr. Ed Yardeni is the President of Yardeni Research, Inc., a provider of independent global investment strategy research. To read more of his blogs, CLICK HERE NOW.

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Despite the latest headlines warned about "a day of reckoning" and the end of the "75-year debt supercycle," there are, however, still plenty of reasons to be optimistic, particularly about the U.S.
economy, united states, america, optimism
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2016-28-29
Friday, 29 Jan 2016 05:28 AM
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