U.S. macroeconomic indicators in recent months had better outcome than expected. The number of jobs created, the results of industry and services sector have improved moderately, real estate market shows signs of recovery and consumption growth is relatively good, write for the site www.project-syndicate.org Nouriel Roubini, so called “Dr. Doom”, who anticipated the collapse of the housing market in the United States and the worldwide economic recession which started in 2008. Roubini is considered today a major figure in the international debate about the world economy.
But despite these favorable results, U.S. economic growth will remain low and below the trend later this year. But why these economic data are not credible? First, American consumers have problems with income and are constrained by debt. Disposable income has increased slightly, despite the stagnation in real wages, largely because of tax cuts and transfer of payments. But these measures are not sustainable because eventually the payments transfer will have to be reduced and the taxes will be increased in order to lower the fiscal deficit.
On the other hand, job creation in the U.S. is still insignificant for unemployment to be reduced. U.S. must create consistently each month at least 150,000 jobs for the unemployment rate to stabilize.
Amid the weak growth of the domestic demand, the only solution for the U.S. to approach the potential growth rate will be the significant reduction of trade deficits. Finally, there are all those risks which make investors, companies and consumers to be very cautious: the risk of systemic consequences arising from debt restructuring in the euro area or worse, collapse of the European monetary union, the result of American presidential election, geopolitical risks after the Arab spring revolutions, military confrontation with Iran, instability in Afghanistan and Pakistan, the succession to power in North Korea and the consequences of the global economic downturn.
