NABE Panel: Subprime and Credit Top Short-Term Threats to U.S. Economy
Monday August 27, 2007
“Financial market turmoil has shifted the focus away from terrorism and toward subprime and other credit problems as the most important near-term threats to the U.S. economy,” says Carl Tannenbaum, NABE President and Chief Economist, La Salle Bank/ABN-AMRO. “However, these concerns appear to be somewhat transitory, as the five-year outlook for housing remains positive.”
Survey Highlights
The combined threat of subprime loan defaults and excessive indebtedness has supplanted terrorism and the Middle East as the biggest short-term threat to the U.S. economy. Just 20% of NABE members surveyed listed terrorism and the Middle East as their top concern in August, compared to 35% in March. Meanwhile, 18% of those surveyed pointed to the effects of the subprime debacle as their biggest concern, and the related issue of “excessive household and/or corporate debt” was cited by another 14%.
The NABE Economic Policy Survey presents the consensus of a panel of 258 members of the National Association for Business Economics. Conducted semiannually, this survey was taken July 24-August 14, 2007. Catherine L. Mann, Brandeis University; Richard A. Brown, FDIC; and Kathleen Camilli, Camilli Economics, conducted the analysis for this report.
National Association for Business Economics