U.S. Poised For Stronger Growth

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    The U.S. economy is poised for stronger growth in 2012, partly because two early indicators of economic recovery finally kicked in during the fourth quarter of last year, says Joe Carson, chief economist at AllianceBernstein. Speaking at its ‘2012 Economic Outlook Luncheon,’ he said typically the early stages of economic recovery are driven by spending on consumer durable goods and housing. However, in this recovery, for the first time in history, it was actually U.S. exports and investment which contributed to early GDP growth. He said the recovery was also hampered during 2011 by several significant events starting with the rising energy prices and then by the impact of the Japanese earthquake on global supply chains and the financial crisis in Europe. With new orders exceeding low inventory levels and the inventory of existing homes dropping back to 2004 levels as the cost of rental accommodation has risen above the cost of home ownership in several major metropolitan areas, he said the U.S. economy can overcome challenges and could grow by as much as 3½ per cent.