What are the signs of US recuperation?

ON THE US

It has been a long, slow and frustrating process, but the US is finally starting to show signs of recovery. The OECD predicts growth of just 2% in 2012, a somewhat anaemic rate compared to historical post-recession periods.

So what are the signs of recuperation? Aside from the country’s recent economic infirmity, its corporate sector appears to be in rude health. Companies have managed to rebuild their balance sheets, reduce their borrowing and improve profitability – yet equity valuations remain very reasonable. A renaissance in the manufacturing sector is another bright spot. The cost of outsourcing labour to EM countries has risen. It is estimated that by 2015, the costs of manufacturing in China will have increased sufficiently to wipe out any advantages to outsourcing for some industries. Elsewhere,...