Election Day is an opportune time to check in with David Rosenberg, the plain-speaking chief economist and strategist at Canadian investment manager Gluskin Sheff + Associates. From his perch north of the U.S. in Toronto, Rosenberg looks at the U.S. presidential election from the edge of the so-called fiscal cliff and the tough budgetary decisions that await the election winner.
What Rosenberg sees is a nation where stocks are 20% overpriced against a U.S. economy that faces, if not an outright recession, then a “growth relapse” that would trim GDP expansion to around 1% at best.
“The economy is still in the throes of a multi-year credit contraction phase,” Rosenberg told clients in a research note published Tuesday. “What we can expect is for the pace of activity to weaken substantially during periods when [Federal Reserve] stimulus fades.”