Chicago Trib on the possibly bleak future of the US economy

[stevebreeze]

This article talks mainly on how the Bush economy will affect investors in the coming year and there after. As with most negative articles on the economy, it was buried on page 5 of the business section.


Ripple effect: Will investors end up winners in this election year?



By Bill Barnhart
Chicago Tribune

January 18, 2004

As voters trudge off to the Iowa caucuses, investors are asking if they will be winners when the presidential election year ends. But this time, stock market skeptics say the Bush administration and Federal Reserve have stoked the economy so strongly, with tax cuts and cheap money, that inevitable austerity after the election will disappoint investors.


"The risk is that China and Japan will sell Treasury securities," said Charles Callard of Callard Asset Management. Declining demand for U.S. Treasuries by non-U.S. investors would force interest rates higher.


-- Dollar trend: In 2003, the weak dollar in foreign currency markets helped boost profits for U.S. multinational corporations. The cheaper dollar permits such companies to post higher revenues and profits from non-U.S. operations. The fear is that the dollar's slide will not subside but instead will erode confidence in U.S. investments and force interest rates higher. Said John Llewellyn, global chief economist for Lehman Brothers, "Foreigners are not investing in the U.S. on quite the scale they were." Noting the U.S. government and trade deficits, he said, "Nobody can live permanently spending more than it saves."

--Expectations for 2005: "Next year is awful," said Grantham. "I'm looking out at the black hole of '05 and '06." Grantham expects the party will be over, as the government reins in investor-friendly fiscal and monetary policies as the next presidential term begins.






http://www.chicagotribune.com/business/yourmoney/sns-yourmoney-economy,0,1590757.story

The need to end the Bush mis-administration should prompt us all to coalesce around the eventual winner of the coming primaries.
:kick:

[Zo Zig]

1. Interesting

The last statement, expectations have factored in the next election cycle according to another recent article. But this snip indicates a different view altogether. Isn't the Trib a Conservative Midwestern paper? The house can't shift much till "06". Expectation have changed to that of a different party in the WH? Interesting.

[dusty64]

2. They obviously did

not receive rove's memo.

[0007]

3. Wait till the seniors wake up!