NEW YORK Next year might be a comparatively good one for
the U.S. economy, according to Mickey Levy, chief economist at
Charlotte, North Carolina-based Bank of America Corp.
Despite the long-run challenges and fiscal issues, I
expect the United States to outperform this (coming) year. In
2013, people are going to say, Things feel
better, Levy told attendees at the seventh annual
Minor Metals Trade Association dinner in New York Wednesday.
The housing market could show particular strength. Fasten
your seatbelt on housing; its going to roar back,
The upcoming fiscal cliff, which has dominated the national
conversation recently, will not have the major impact many
expect, Levy said.
My expectation is there will be some compromise either
before year-end or soon thereafter. Youll end up with a
moderate amount of tax increases and a little bit of spending
cuts. Well get over this hump, Levy said, adding
that in his estimation businesses had already largely prepared
themselves for higher taxes.
Itll come and go, but higher taxes wont have
a negative impact on business activity, he said. However,
he noted that they might have a slight negative affect on
In the long run, the country will need to address the
ballooning budget deficit, Levy noted.
Someone asked me recently whether these budget issues are
a ticking time bomb or a slow bleed. My answer is that
theyre both, Levy said, explaining that a growing
deficit could lead to instability in the financial markets and
could crimp future growth.
He said that he expects little growth in the European economy
over the next three years due to the fiscal issues there, but
noted that the region's national governments have demonstrated
enough commitment that the eurozone seems unlikely to
The chances of Europe coming apart at the seams (are)
very, very low now, Levy said.