The bond market’s been arguing with the stock market in recent months about where the economy’s headed. On the fixed-income side, the outlook has been one of relative pessimism for 2007. Stocks, by contrast, see a brighter future for this year. By one economist’s reckoning, the stock market has won the debate.
So said Nariman Behravesh, chief economist for Global Insight, at a Dow Jones-sponsored conference in New York this morning. Behravesh opined that U.S. economic growth is stronger than some assumed it would be. Corporate earnings growth in 2007 will be “decent” after all. Slower than in ’06, he acknowledged, but still fairly robust. “There’s a lot of strength in the U.S. economy,” he said.