The summer rally hit its one-month mark today, but can it continue? Ernie Ankrim, senior markets advisor at Russell Investment, and Doug De Groote, managing director at United Wealth Management, discussed their outlooks.
“We’re still in a deflationary cycle, especially in the real estate and the financial services, and the banking industry has some way to go,” De Groote told CNBC.
De Groote said until liquidity returns into the markets and consumers, the cost of capital is going to be a big issue.
In the meantime, Ankrim expects the economy to continue growing and eventually see a U.S. GDP growth of approximately 3 percent by the end of 2010.
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“We might not have a major correction. If we saw a major correction in the economy right now, it could set us up for a W-shaped type of experience,” said Ankrim.
“The Fed has to have an elegant way to extract itself and the massive amount of liquidity. They will be able to do that if we slowly grow out of this and that’s what’s coming.”
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No immediate information was available for Ankrim or De Groote.
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