Discuss.
The U.S. is back in the driver’s seat of the global economy after 15 years of watching China and emerging markets take the lead.
The world’s biggest economy will expand by 3.2 percent or more this year, its best performance since at least 2005, as an improving job market leads to stepped-up consumer spending, according to economists at JPMorgan Chase & Co., Deutsche Bank AG and BNP Paribas SA. That outcome would be about what each foresees for the world economy as a whole and would be the first time since 1999 that America hasn’t lagged behind global growth, based on data from the International Monetary Fund.
“The U.S. is again the engine of global growth,” said Allen Sinai, chief executive officer of Decision Economics in New York. “The economy is looking stellar and is in its best shape since the 1990s.”
Policies Superior
The U.S. has pulled ahead of other industrial nations partly because its policy-making has been better, according to Paul Mortimer-Lee, chief economist for North America at BNP Paribas in New York.
European Central Bank President Mario Draghi and his colleagues are still weighing whether they should buy government bonds to fight off the danger of deflation -- a step that the Federal Reserve first took back in 2009.
U.S. budget policy also has been more effective than the euro region’s austerity strategy, which undercut the continent’s economy, Mortimer-Lee added.
Even Alberto Alesina, a long-time proponent of government spending cuts, thinks the euro area should adopt a more expansionary fiscal stance. Alesina, who is a professor at Harvard University in Cambridge, Massachusetts, told the AEA conference on Jan. 5 that he favors more “aggressive” tax cuts by the region’s policy makers.
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It's cute that you think ANY president directly manipulates oil prices, the stock market, the Fed, or the business cycle.
