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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Return to Sender who wrote (43250)	4/20/2006 4:10:28 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 68411

Hi RTS, The risk in the United States is preceived globally, just not in the United States. Given the perceived risk I am surprise interest rates are now higher in the United States. Of course all the national banks are more coordinated these days and most are adverse of inflating their economies again. Too many lived through the hyper inflation of the 70's to want that to come back again. The key is that median incomes are down not up, so how can the market support significantly higher prices. ************************** IMF cuts Canada's growth forecast Cites rising loonie, commodity risk, U.S. slowdown World's economic output set to beat expectations in 2006 Apr. 20, 2006. 01:00 AM The world economy is in better shape than expected despite high oil prices, though Canada's economy will grow a bit more slowly than previously thought, the International Monetary Fund says in its latest projections. Global economic output will expand by 4.9 per cent this year, up 0.6 of a percentage point from the IMF's prior forecast, and 4.7 per cent in 2007, up 0.3 percentage point. Canada is now expected to grow by 3.1 per cent this year and 3 per cent the next, down two tenths of a point from the IMF's September forecast. That's still good enough for Canada to post the second strongest expansion in the G-7 group of industrialized countries, just behind the United States. The biggest risks facing Canada are a rising currency, a slowdown in the U.S. economy and softening world commodity prices, according to the latest World Economic Outlook. "The fiscal outlook remains favourable," the report read. "The new government has some fiscal room to manoeuvre in achieving its objective of lowering the tax burden and slowing spending growth." The IMF praised Canada for maintaining balanced government budgets and paying down the public debt. "As in most industrialized countries, however, rising health-care costs present a longer-term challenge." For the world's largest economy, the IMF is predicting U.S. economic growth will increase by 3.4 per cent this year and 3.3 per cent next year. It grew by 3.5 per cent in 2005. The biggest economic risk hanging over the U.S. is a potential sharp drop in residential real estate values, the IMF said, noting that Americans tapping into their home equity has helped fuel consumer spending. "House prices are now looking more richly valued and as affordability has declined, buyers have increasingly resorted to interest-only and negative amortization loans," the report stated. "A weaker housing market could trigger a more abrupt withdrawal of consumer demand than anticipated." Strong corporate profits and healthy balance sheets in both Canada and the United States have spurred an investment boom, and that is expected to continue, perhaps even boosting jobs by more than expected, the report said. As well as the run up in oil prices, global financial imbalances — specifically, the ballooning U.S. trade and government deficits — and a worldwide outbreak of the deadly bird flu, also threaten the world economy, IMF research director Raghuram Rajan said. "This period of strong growth is the perfect time to address the medium-term problems that every economy faces, including the problems of adjusting to a more competitive integrated world." The world economy expanded by 4.8 per cent last year and is projected to grow by 4.9 per cent this year. Last year's performance turned out better than the IMF had predicted, and its forecast for 2006 was upgraded. In September, the institution forecast global economic growth would clock in at 4.3 per cent for 2005 and 2006. The IMF said China, which saw its economy grow by a blistering 9.9 per cent in 2005, will probably see another hot year, steaming ahead 9.5 per cent this year. Next year, China's economy should expand by 9 per cent. With the U.S. trade deficit with China hitting a record $202 billion (U.S.) last year, the Bush administration is pressing Beijing to take steps, notably revamping its currency, to narrow the gap. Chinese President Hu Jintao is scheduled to meet President George W. Bush today. Staff and Star wire services