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January 31, 2013 at 11:56 PM
Breathe a sigh of relief—Craig Alexander is optimistic about 2013.
After delivering a stark global outlook for 2012 last year, Alexander took to the stage at this year’s TD Ameritrade annual conference in San Diego on Thursday to tell advisors in the audience that he’s bullish on the U.S., the recession in Europe is mostly behind us and he’s seeing growth in emerging markets.
“I see 2013 as a year of transition,” Alexander, senior vice president and chief economist of TD Bank Financial Group, began in his lunchtime keynote. “After very soft performance in 2012, in which global growth dropped below 3%, I see the global economy picking up once again.”
Zeroing in on Europe, a region he described at last year’s conference as the No. 1 risk facing the globe, Alexander noted it’s still a problem, but the odds of some sort of bank shock have greatly diminished and leaders have made progress in separating “the sovereign crisis from the bank crisis.”
“The ECB has injected liquidity and the bottom line is that their headed in the right direction and moving towards a fiscal union, which is difficult but doable.”
The largest positive development of the recent past, he added, was when the ECB said it would do whatever it takes to save the euro.
“Market fears of a debt default can cause a debt default,” Alexander said. “It becomes self-fulfilling because the fear causes interest rates to rise. The ECB said if the individual countries’ markets don’t buy the debt, then the ECB will. As a result, Europe will muddle through.”
Moving on to the developing world, Alexander said that after a slowdown in emerging markets in 2012, a soft landing has taken place, and many economies are already reaccelerating.
