- "Economic growth has been far short of what business cycle
historians would have anticipated based on the severity of the recession. In the
U.S. case, the near 4% drop in output should have produced a 6%-7% recovery.
But with only a few bits of data left to fill in the blanks, estimates suggest GDP
will have expanded by roughly 3½% in the year ending this month."
- "With household savings rates creeping irregularly higher and credit use and access being resized, income will be an all-important governor on demand growth. At the same time, near-term pressures on state and local governments to close budget gaps, point to drag of roughly a half percentage point on GDP for the next couple of
years."
- "From this perspective, we marked down near-term growth estimates to reflect
both the recent setback in financial conditions and the notion that its
underlying causes are unresolved at this stage. But like the Fed this week, we
see recovery continuing. The Fed’s statement acknowledged as much by characterizing recovery as “proceeding” instead of “strengthening”."
Citigroup Comments on Credit 20100625
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