Panel Argues Uncertainty Reigns in 2013 for U.S. Economy
Pablo Goldberg, global head of emerging markets research at HSBC, said that Mitt Romney's failure to win the presidency renewed confidence that the incoming government wouldn't hinder the Fed's course of action, and that the U.S. wouldn't take the risky action of qualifying China as a currency manipulator. Goldberg said that designating China as such could have brought some tension in the relationship between the two nations, which could have broader effects on global markets.
As to the Fed's pro-stimulus monetary policy, Eric Lascelles, chief economist at RBC Global Asset Management, said the answer was still open ended as to whether Europe's austerity method was better. He said austerity has certainly been a major headache for struggling debtor nations like Greece and Spain.
"Austerity is indeed incredibly painful," Lascelles said.
The panelists spoke about energy policy and its importance in Obama's new term as hydraulic fracking has opened up new oil and natural gas opportunities.
The International Energy Agency announced last month that the United States would become the top oil producer in the world by 2020, largely due to new crude discoveries that have resulted from novel drilling practices.
Christian O'Neill, an oil and gas analyst at Bloomberg Industries, said that with energy being a basic buiding block for GDP, the Obama administration would heavily consider the new methods of drilling.
The country is still in the early steps of oil supply growth as the advent of shale is quite young, but production could lead to lower crude oil prices here.
Addressing the issue of whether the United States would approve full construction of the Keystone XL Pipeline, O'Neill said a clue of its fate could be found in politicians' choice to push a decision until after the elections. He said if the president and legislators really wanted to deny it, they could have done so.
O'Neill added that the pipeline would likely bring added jobs to the economy, and that if we continue producing oil through fracking, that there eventually will be a "need" to get that oil to areas with the highest demand.
Still, though, many politicians continue to oppose much of the legislation as they have raised major concerns of the new drilling methods' effect on water resources and other surrounding environments.
-- Written by Joe Deaux in New York.