Pros Say: Expect Growth Signs By Year's End
Strong performance from consumer and bank stocks helped put Wall Street on a course to cut last week's steep losses. However, some skeptics still said they are worried about how long this market rally will continue. Read and listen to what the experts had to say...
Signs of Growth by End of Year
Bruce Kasman of JPMorgan said the economy is going to take a while to recover. “We’re forming a stable base, but we’re still a number of months away from showing strong growth,” he said. He expects signs of growth at the end of this year.
Smaller Banks Need More Capital
According to former Comptroller of the Currency Robert Clarke, big banks are not the only ones in trouble. He said smaller banks will also need to raise “lots and lots of capital.”He criticized regulators, saying they are treating smaller banks unfairly without giving them a chance to correct themselves.
‘Green Shoots’ in Housing Market
CEOs from several regional banks said they see some signs of “green shoots” in the housing market. “We’re seeing large correspondent warehouse providers coming back into the market, making money available to larger mortgage regional bankers,” said Steve Calk, CEO of Chicago Bank. “It’s a clear sign that people are looking back at supporting the mortgage market.”
Still Worried About Consumers
Although there are some positive signs in the markets, Donald Powell, former FDIC chairman, said he is worried about consumers. He said there should be incentives given to private sectors to create new jobs for the unemployed.
‘Government Intervention Jeopardizes Innovation’
Chris Johnson of Johnson Research Group said with all the government intervention in different sectors, he fears innovation is going to be stifled. “That’s a big danger point in the markets in the next 3 to 5 years and it will dramatically cut back on its effectiveness of [businesses] coming out of the bear market,” he said.
Health Care Reform Debate
David Walker, former U.S. Comptroller General, said it’s “unlikely that the Obama administration is going to be successful in achieving major health care reform this year” because they don’t know how they’re going to pay for it.
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