Full text of speeches: Kroszner, Mussa, Zonis.

U.S. Economy's Slow Growth Still Getting No Respect.

Citing the late comedian Rodney Dangerfield, professor of economics Randy Kroszner said the U.S. economy is still not getting any respect, despite posting strong numbers even among consumers. "When you look at various surveys, people say the economy is sputtering - or sometimes much more colorful language than that", he said. "But if you look at people's actions, they continue to buy goods and services, so I think their actions speak much more loudly than their words in this case". The US economy has grown for 16 straight quarters. We have had growth above our long-run trend rate of roughly 3.25 percent for ten quarters in a row, a full two and a half years. Despite the terrible tragedies of Katrina and Rita in August and September - among the greatest natural disasters the US has ever experienced - , the GDP data released last week show that the economy grew at 4.3 percent during the third quarter. No major industrialized economy in the world has had such strong growth over the last couple of years. I believe that real GDP growth will continue to be a bit above the US post-war average at the mid-3's (percent) for 2006.

The global economy registered the strongest growth in a generation in 2004, but this year slowed down to about 4 percent, said Michael Mussa, senior fellow at the Institute for International Economics in Washington DC. "I expect we'll see a modest further slowing of growth in the world economy next year", Mussa said. "That is largely because the U.S. economy will lose a little bit of forward momentum. A couple of other economies, China in particular, are also likely to slow down. There's not much reason to expect a significant pickup on average elsewhere in the world". On a year-over-year basis U. S. real GDP will advance about 3 percent for 2006, following gains of about 3 ½ percent for 2005 and 4 ¼ percent for 2004. With growth moderating and inflation in check but not abating, the Federal Reserve will end the present cycle of monetary tightening next spring at a federal funds rate of 5 percent. Yields on ten-year treasuries will notch up to over 5 percent, partly reflecting diminished enthusiasm of foreign investors for further accumulation of U.S. based assets. As 2006 progresses, the dollar will likely reverse its 2005 appreciation against the euro and the yen; but I do not anticipate a dollar crash. With the slowing of global growth and hence of growth of world energy demand, world energy prices are unlikely to show further large increases.

Marvin Zonis, professor emeritus of business administration, cited a published report that real median household income fell for the fifth year in a row this year. "If that is true, that might explain why this economy doesn't get any respect, because there's an awful lot of American people who don't feel better off even though the GDP is growing robustly".