1. October 2011 Forecast Review Doug Macdonald Utah League of Cities and Towns

2. Led by China, nominal GDP will average 5.1% in 2012 (down 1% from 2011) Source: The Economist, October 8, 2011

3. The U.S. economy (real GDP) appears to be moving upward

4. The Fed’s U.S. leading economic indicators are improving too

5. But the ECRI leading index is pointing down

6. And a European Crisis Looms Joe Brusuelas, Bloomberg, “Hard default in Greece will require recapitalizations in U.S. (JP Morgan, Citi, Wells, BofA, HSBC, GS) Mohamed El-Erian, PIMCO, “French banks are under pressure” Neil Barofsky, NYU, “The parallels with 2008 are remarkable, low capital held against assets.” Nouriel Roubini, NYU, “We are running out of policy bullets. At this point, the issue is not whether there is going to be a recession, but whether it’s going to be severe recession and a global financial crisis.”

7. AndAnd a European Crisis Looms

8. U.S. Business Equipment & Software will in improve in 2012, but at a slower pace

9. Utah employment still headed up, while U.S. job growth stalls

10. Unemployment claims rose a bit in last three months, but are now below 2002 levels

11. Consumer sentiment up 4 points in September after plummeting in July & August

12. Utah Residential Construction up 2% in 2011 thru July, may improve up to 15% in 2012 Source: Univ. of Utah, BEBR

13. Last three months increased 4.3%

14. Salt Lake County 2 nd Quarter Sales Stats Sales in Million $% Change from 2010 Manufacturing$ 203- 0.8% Wholesale durable goods 458 10.9 Retail – General merchandise 551 5.5 Retail – Motor Vehicles 575 25.3 Retail – Apparel 156 11.4 Retail – Eating and drinking 400 8.1 Retail – Food stores 360- 7.4 Services – Business 236 24.8 Services – Auto Rentals & Repair 176 7.6 Total Taxable Sales$5,035 6.2 Source: Utah State Tax Commission

15. U.S. consumers continue to spend despite volatile job and stock market conditions

16. 1 month, ytd -1.2%