Will 2014 Construction/Manufacturing Replicate Automotive 2013 Success?

January 28th, 2014 | by Morris Beschloss | Comments

According to A.T. Kearney, arguably one of the world’s most outstanding research/consulting firms, the United States has become the world’s leading facilitators of manufacturing expansion, as well as opportunistic for residential, commercial, and industrial construction.

Early 2014 statistics and analysts already indicate that such supreme optimism is off to a good start. The Institute for Supply Management (National Association of Purchasing Agents) started off the year with a strong positive, while the wide gamut of residential, commercial, and industrial construction is on the way to its best year since 2007. To develop this growth thesis even more, the following factors come into play:

1) Employment. Although the overhang of unemployment continues to fester, it also provides the personnel power if the Administration, working with business, decides to get serious about infrastructure development of pipelines, highways, dams, bridges, railroad tracks, etc. This would be even more supportive if the Environmental Protection Agency would get off their extremist kick and allow commercial momentum to have a breakthrough year.

2) Entrepreneurialism. With independent business units straining at the leash of technological and facility expansion, unemployment would shrink more than expected, since privately-owned businesses are responsible for 70% of the nation’s hiring.

3) Natural Resources Exports. At this point, the Feds are still wary about the shipping abroad of crude oil, despite the surplus being provided by the monthly increase of West Texas Intermediate (light sweet crude) production that now makes such outflow feasible and profitable in generating billions of dollars in revenues. The liquid natural gas option has already been given the green light, but liberal extremists have so far put the kibosh on the Trans-Canada XL oil pipeline, as well as cancelling the freeze on crude oil exports, dating back to the 1973-4 Mideast oil embargo, which played havoc with America’s oil supplies.

4) Construction boom. After a 2013 turnaround year that witnessed the awakening of housing inventory sales, and higher prices, in conjunction with a major swing toward leasing and rentals, the genesis of an industrial comeback, spurred by manufacturing expansion and commercial activity will overcome short-term demand dips and greater on-line retail buying.

5) Not taken into account are the negative impact of Obamacare, immigration debate friction, and the excessive Congressional bickering preceding the mid-term elections on November 4. While the $17.3 trillion deficit will be adjudicated with a slight drop in the 2014 budge deficit, both political parties will take pains to keep from being tainted with the brush of undercutting economic revival.

6) Expect an excess of record overseas investment funds to flow into the U.S. for commercial ventures, while cutting back of weekly Treasury debt purchase participation.
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