The U.S. economy is the strongest among developed markets as a debt crisis weighs on Europe, said Joseph Tanious, a global market strategist at JPMorgan Chase & Co. (JPM:US)’s asset-management unit.
“It’s kind of like the best house in a really lousy neighborhood,” Tanious today said at a presentation in Washington. The U.S. economy will grow at about a 2 percent pace for the next two years, he said.
Tanious joins JPMorgan Chief Executive Officer Jamie Dimon in highlighting the potential for the U.S. economy while Europe struggles, even as tax hikes and spending cuts loom as part of the so-called fiscal cliff. Lawmakers will find a way to avoid the fiscal cliff after U.S. elections in November, Tanious said.
“It is in no political party’s best interest to push the U.S. economy into a recession,” Tanious said at the American Council of Life Insurers’ annual conference. “You’re going to see a lot of political banter, but at the end of the day I do think an agreement will be reached.”
Dimon hosted a meeting of more than 75 CEOs at his bank’s New York headquarters yesterday to build support for a campaign to address the U.S. deficit and avert the fiscal cliff, according to a person with knowledge of the event. He’s said bond markets will eventually spurn U.S. debt if lawmakers fail to reach an agreement to address the deficit.
Still, Dimon has affirmed his faith in the U.S., saying Oct. 10 that the economy remains “fundamentally stronger than people might think.”
The U.S. economy will grow by 2.1 percent this year and 2 percent in 2013, according to estimates compiled by Bloomberg. The euro zone may shrink this year and grow by 0.3 percent next year, economists estimate. Better growth prospects have helped the Standard & Poor’s 500 Index (SPX) of U.S. stocks rally 12 percent this year, compared with the 9.8 percent gain of the Stoxx Europe 600 Index. (SXXP)
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