Wednesday, May 21, 2014

Gary Shilling: Deleveraging has another 4 years

Once private sector de-leveraging is completed in another four years or so, real GDP growth will probably return to its long-run trend of about 3.5 percent, and may be higher on a catch-up basis – a big jump from the 2.3 percent growth in the recovery so far.

The headwinds of de-leveraging will have calmed and more rapid productivity and labor force growth will likely return. And the slow-growth-forever crowd will need to find new theories to promote!