Free-spending American consumers will be the bright spot in the U.S. economy for the next few years, even as weak foreign buying power and tepid growth in the Gross Domestic Product work against them, according to the latest forecast from the University of Central Florida’s Institute for Economic Competitiveness.
UCF economist Sean Snaith predicts growth in real consumer spending from 2015 to 2018 will average 3 percent.
“Consumers are not spending as freely as they did in the previous expansion, but have at least loosened their collars and their pocketbooks as well,” Snaith writes in the 2015-2018 “Forecast for the Nation.” “The improvement in consumer spending growth is all the more important now when looking at the other main sectors of the economy, which continue to face headwinds that persistently suppress growth.”
Those other sectors threaten to push down the economy:
In keeping with the season, Snaith also uses the holiday film classic “It’s a Wonderful Life” to provide a primer in the value of community banks. Community banks like the one Jimmy Stewart’s George Bailey runs in the film’s Bedford Falls play an important role in providing small business financing.
Snaith maintains that the Dodd-Frank financial regulatory reform law is strangling community banks, threatening their livelihood and that of the small business employers that depend on them.
“Bedford Falls was a dismal place without the Bailey Building and Loan and our economy is worse off with a community banking sector crippled by excessive regulation,” he writes.
Snaith is a national expert in economics, forecasting, market sizing and economic analysis who authors quarterly reports about the state of the economy. Bloomberg News has named Snaith as one of the country’s most accurate forecasters for his predictions about the Federal Reserve’s benchmark interest rate, the Federal Funds rate.
Snaith also is a member of multiple national forecasting panels, including The Wall Street Journal Economic Forecasting Survey, CNNMoney.com’s survey of leading economists, the Associated Press Economy Survey, the National Association of Business Economics Quarterly Outlook Survey Panel, the Federal Reserve Bank of Philadelphia’s Survey of Professional Forecasters, the Livingston Survey, Bloomberg U.S. Economic Indicator Survey, Reuters U.S. Economy Survey, and USA Today Economic Survey Panel.
The Institute for Economic Competitiveness strives to provide complete, accurate and timely national, state and regional forecasts and economic analyses. Through these analyses, the institute provides valuable resources to the public and private sectors for informed decision-making.