Photo: Goldman Sachs
Goldman Sachs, along with many banks on Wall Street, have turned incredibly bullish on the prospects for the U.S. economy.Just last week the bank’s chief economist, Jan Hatzius, spelled out why he think the U.S. is going to boom in 2011. Now we have the charts to back up his opinions.
Goldman’s bullishness centre’s on their belief that the jobless recovery actually isn’t that much of a threat, that manufacturing continues to grow, the consumer is about to spring back to life, and the Fed will do everything it can to make sure things run smoothly.
Not a bad combination to back up their S&P target of 1500 for 2011.
Personal consumption expenditures are predicted to rise 3.5% in 2011. They make up around 70% of the U.S. economy.
Bank loan growth has now turned positive, indicating consumers are interesting in taking on debt again.
Part of the reason confidence in the recovery is weak is because this recovery has been jobless. But that's not abnormal, as the 1991 and 2001 recoveries were similar.
This data leaves Goldman thinking much more positively about the 2011 GDP outlook, than many of their competitors, with annual growth of 3.4%.
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