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Economic Conditions to Aid Your Assessment

The political environment remains uncertain and concerning, but the economy seems to be chugging along slowly, reflecting some but not robust growth. The first quarter GDP grew only 1.2% annualized but was better than expected. It appears the United States is heading toward a 2-2.5% annual growth rate. 

While new home sales fell in April, March reflected the highest new home sales pace since 2007. Consumer spending has remained strong through the first quarter and is expected to increase in the second quarter. We are nearing full employment as April job openings were the highest since 2000, according to the U.S. Department or Labor. The problem is that companies have openings but can't find skilled workers to fill them. While the Fed did not move interest rates in the May meeting, anticipated economic growth still has it signaling for future rate increases in the coming quarters.
 
Big issues to watch in the coming months:
The resolution to an approved U.S. budget. You can be assured of a congressional fight over raising the debt ceiling and President Trump's infrastructure building proposal. 
The Fed’s approach to further interest rate changes and how it will carefully reduce the expanded balance sheet, which was built up during the quantitative easing program. 
Congress approving a new tax plan and finalizing a change in Obamacare. Most corporate CEOs view these as critical to further economic growth. 
 
The banking industry is closely watching the passage of the Financial CHOICE Act, which will provide some relief to Dodd-Frank legislation that has had a negative impact on some banks’ ability to efficiently serve customers.  
 
There is a lot to take in and think about, but the economic direction appears generally positive. These uncertain times require more thoughtful consideration and advice as you contemplate asset investments, leverage or business expansion. That’s where Bank SNB bankers come in. 
 
We will be a valued resource as you look to expand your company and perhaps change your financial structure with added use of leverage. Involving Bank SNB experts early in your assessment will save time and effort. And while the news is sometimes confusing and concerning, stay positive but realistic. The future is bright.
 
 
On The Mark was written by Bank SNB President and CEO Mark Funke.