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How Can the U.S. Economy Start Living Up to Its Potential?

October 04, 2016

LPL Research

Although we are still more than seven full years into the current economic expansion, many people still feel a sense of disappointment in its progress.

Growth has to come from somewhere, and we believe that potential areas of improvement include business spending and wage growth.

- LPL Research

[PDF] HOW CAN THE U.S. ECONOMY START LIVING UP TO ITS POTENTIAL?

Economic growth has been below trend, and we believe two major forces are keeping the U.S. economy from reaching its potential: monetary policy and income/debt dynamics.

Despite this below-trend growth, we continue to believe there are reasons to be optimistic about our economic future. While the U.S. economy is not currently living up to its potential, we believe in the prospect of stronger growth and continued global leadership. Additional economic growth, driven by wage growth and business spending, can help us close the GDP gap quickly, helping the country again reach its economic potential.