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KPMG survey predicts Federal Budget Deficit will decline

over next decade

Private Equity Fund Of Funds by Armando Duke Senior Staff Reporter

The Bush administration is predicting job growth will average 175, 000 per month over the course of 2005. In London, Federal Reserve Board Chairman Alan Greenspan Friday said the recent dollar decline and likely action to narrow the U.S. budget deficit could stabilize and even cut the record U.S. trade deficit. The Federal Reserve Board chairman is in London for a meeting of finance officials from the world's richest industrial nations. Mr. Greenspan told a London conference that the voice of fiscal restraint, barely audible a year ago, has at least partially regained volume. President Bush is promising to reduce the U.S. fiscal deficit by half over the next four years., a key gauge of consumer sentiment, issued monthly by the University of Michigan, registered a slight decline in January. Spurred by consumer spending, the U.S. economy has been growing at about a four percent annual rate.

Curve Equity Exposed Fund Respondents to KPMG's 28th annual survey of economists and investment strategists predict that the federal budget deficit will decline over the next 10 years.Visit our AXcess News Forum and add your comments on this story. Try your hand at writing, the best story will be published on our news network. Take our business poll too!

Democratic lawmakers charged that the tax cuts would increase the federal budget deficit, despite claims by Republicans that the tax cuts would pay for themselves by generating new jobs. "In five short years, the Republican Party failed economic policies have instigated $1.57 trillion in budget deficits and added $3 trillion to the national debt, " said House Minority Whip Steny Hoyer ( Md.).

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Gordon Brown has renamed the DTI the Department for Business, Enterprise and Regulatory Reform (DBERR) to reflect its focus on the reduction of red tape and a commitment to entrepreneurship. sized manufacturers appear to be in the process of recovery after more than a year of decline, a CBI survey has revealed. The survey shows that SMEs predict that the volume of orders over the next three months will grow at the fastest rate for more than ten years.

Capital Casebook Equity March 31, 2004 (AXcess News) New York - KPMG LLP released findings for its 28th annual survey of economists and investment strategists at 30 leading international financial institutions and investment organizations.

Billionby Voanews The U.S. budget deficit is projected to reach $ billion this year, biggest shortfall in U.S. history. If you would like to receive late breaking business news covered by AXcess News then you need to subscribe. By joining, box first. Print This Page Jan 25, 2005 (AXcess News) The U.S. budget deficit is projected to reach $ billion this year, biggest shortfall in U.S. history.The deficit could go even higher once Congress approves more money for military operations in Iraq and Afghanistan.

Private Investment In Public Respondents also predict that the Federal Reserve will raise short-term interest rates sometime this year and that the federal budget deficit will decline over the next 10 years.

Final passage of the budget reconciliation bill will also impact paid pension plans. The Deficit Reduction Act includes increases in premiums paid by employers to the Pension Benefit Guaranty Corporation (PBGC) in an effort to reduce the federal budget.

Equity Mutual Funds "After several months of sustained growth, we're seeing a real return of confidence in the U.S. economy," said Neil Wolfson, national partner-in-charge, KPMG Investment Advisors. "The survey reveals positive expectations in several key areas, including steady, moderate economic growth, low inflation, and strong stock market gains. Against the backdrop of an improving economy, interest rates are expected to rise substantially, especially in the short end of the yield curve."

Birmingham Contact Equity The Dow Jones Industrial Average is expected to top 11,000 by year-end 2004, driven by moderate economic growth and relatively mild inflation.

Private Equity Investment Firm Looking at the U.S. equity markets, 81 percent of the respondents predict the Dow Jones Industrial Average will close out 2004 above 11,000, with 8 percent seeing the index soaring to 12,840, compared with its 2003 close of 10,454.

Complying Deal Equity Funds Stock returns are expected to even out over the next five- and 10-year periods, according to respondents, in contrast to the bull run of the '90s followed by the sharp declines between 2000 and 2002. In general, those surveyed anticipate equities will offer returns of between 8 and 13 percent through 2013, with small- and mid-cap stocks providing the best performance in the short and long term.

Equity Msn Private Wyoming Among asset classes, venture capital stocks are expected to offer the best returns: 15 percent this year, 12 percent over the next five years, and 13.5 percent through the end of 2013. Large, mid- and small-cap stocks are expected to post annual returns for 2004 of 10 percent or above, with large- cap stocks posting the greatest gain of 13 percent. Real estate is projected to underperform the stock market, leveling off after its steep rise over the past few years.

American Equity Investment "I think it's significant that respondents this year are predicting steadier market gains that are in line with historic performance," said Rex Macey, director of research for KPMG Investment Advisors. "The dramatic losses in the three years prior to 2003 scared away many investors from equities. These forecasts of more consistent performance may go a long way to luring people back to stocks."

Equity Index Funds Survey respondents predict that international equities will perform more evenly for the long and short term, consistent with U.S. markets. Overall, international stocks are expected to post double-digit returns for 2004, after an extremely strong rebound in 2003. Stocks in the Pacific-ex-Japan region are seen leading the way with gains of 16 percent, followed by international small-cap stocks with 13.6 percent and emerging market equities with 13.5 percent. Over the next five and 10 years, Japanese small-cap stocks are pegged as the market leader, with 15 and 12 percent returns, respectively, followed closely by emerging markets.With interest rates at 40-year lows, 72 percent of respondents expect the Federal Reserve to raise the cost of short-term borrowing before 2005, with 34 percent expecting a rate increase sometime in the first half of 2004.

Equity Private Team Wyoming "The Fed's efforts to stimulate the economy with lower rates have created a great environment for companies to invest in their businesses, not to mention helping thousands of Americans purchase homes or save hundreds of dollars a month by refinancing their mortgages," Wolfson said. "Now that the economy is on a more solid footing, respondents expect the Fed to return rates to a more normal level."

Equity Group Investment Among fixed-income investments, respondents project that high-yield bonds will outperform other sectors this year and over the short and long term. However, high-yields aren't expected to repeat their 2003 performance of 29 percent gains; instead, they'll return a much more modest 5.4 percent this year and 7 percent over the next 10 years, according to those polled. Yields on U.S. Treasury securities and AA-rated corporate bonds are seen rising over the short and long term, especially on the short end of the yield curve. One-year Treasury notes are expected to rise from their current yield to 1.8 percent by year-end and 3.3 percent by 2008.AXcess News will be reporting on any new market trends related to this story. Members should watch their in-box for late breaking news. If you're not a member, consider joining now. Members get the latest business news, commentaries and stock picks delivered right to their in-box.

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