Komfie Manalo, Opalesque Asia: Bob Doll, Senior Advisor to BlackRock, the world’s largest asset manager with $3.56tln in assets under management as at end June 30, 2012, said that to suggest that the US economy is heading into a recession is an overreaction.
In his weekly investment commentary, cited the number of important sources of strength within the United States, including the strong financial health of the corporate sector, a healing banking system, historically low levels of credit card delinquencies and signs of increased discretionary spending by consumers, which makes the risk of recession low. "Our view is that absent some sort of new catastrophic event, U.S. growth should remain positive, if hardly stellar," Doll said in his commentary.
Although he acknowledged that United States is facing a number of structural problems that are keeping a lid on economic growth. Business confidence is weak, which has translated into anaemic levels of hiring and capital spending. The looming "fiscal cliff" and the associated political dysfunction make it difficult to believe that the nation’s debt problems will be solved and the country is still in the midst of a long-term deleveraging process, he said.
Doll commented, "We are currently in the midst of second-quarter earnings reporting season and results have been at least decent, with forward guidance being fairly tepid. Ove......................
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