Let's go through the long list that paints a picture of both short-term and longer-term risk to the U.S. economy.
Yes, Canada is in way better shape than the U.S.
However, the U.S. is the single most important growth factor for the Canadian economy. To fully understand Canada's prospects, you need to understand the U.S. prospects.
- The U.S. is not creating enough jobs to cover the growth of the population.
- The stimulus policy is not working.
- Consumer and business confidence is down.
- For a large number of firms, credit conditions have not improved since the crisis.
- The U.S. faces Europe-like debt/GDP and deficit/GDP ratios.
- Financial reform bill seen by many as institutionalizing the cult of bailouts.
- Discouragement about the massive Gulf spill
- Disappointment about the progress in Afghanistan
What about the good news? Uhhh... Maybe your favorite team advanced in the World Cup?
I have some other thoughts.