1. March 12, 2008 Economic Outlook CCIM

2. Wachovia Economics Group 2 Economic Growth We Are Now Forecasting A Modest Decline In Real GDP The first half of 2008 has gotten off to a very slow start Wachovia

3. Wachovia Economics Group 3 Economic Growth Final Domestic Demand Is Much Weaker Than The GDP Figures Imply. Much Of This Weakness, However, Is Falling On Foreign Producers Domestic demand will fall in three of the next four quarters Wachovia

4. Wachovia Economics Group 4 Employment Growth Nonfarm Employment Has Fallen For Two Months In A Row. Employment Conditions Are Likely Weaker Than The Headline Figures Suggest Nonfarm payrolls will likely hold up better than they did in the last recession Wachovia

5. Wachovia Economics Group 5 Labor Markets The Unemployment Rate Has Risen But Remains Relatively Low As Job Seekers Have Exited the Labor Force We do not expect to see problematic stagflation as there is no evidence of a wage-price spiral Wachovia

6. Wachovia Economics Group 6 Consumer Spending Consumer Spending Is Primarily Driven By Income Growth, Which Remains Solidly Positive. However, The Housing Slump Will Slow Retail Sales “Tax Rebates” will likely give retail sales a boost late this spring Wachovia

7. Wachovia Economics Group 7 ISM Manufacturing Manufacturing activity is consistent with a slowdown but not necessarily a recession Wachovia

8. Wachovia Economics Group 8 Housing The Bulk Of The Declines In Homebuilding Are Behind Us, However They Will Continue Until Early 2009 Permits in many of the most challenged markets are rapidly approaching zero Wachovia

9. Wachovia Economics Group 9 Housing We Overbuilt Homes for Five Straight Years & We Will Need to Under-Build For A Few Years Before the Excess Inventory is Corrected Housing starts will not meaningfully rebound before the end of the decade Wachovia

10. Wachovia Economics Group 10 OFHEO Home Price Index Over Sixty Percent of the U.S. Population Live in Cities With Positive Home Price Growth OFHEO Source: OFHEO and Wachovia Corp. Wachovia

11. Wachovia Economics Group 11 Non-Owner Occupied Purchase Loans: 2006 Investors Were Responsible For More than Half of the Purchases in Some Markets in 2006 Investor & Second-Home Mortgages Source: HMDA and Wachovia Corp. Wachovia

12. Wachovia Economics Group 12 Office Vacancies The national office market is essentially in equilibrium Wachovia

13. Wachovia Economics Group 13 Industrial Vacancies Industrial markets are stronger than the vacancy data suggest Wachovia

14. Wachovia Economics Group 14 Charlotte The Charlotte area added close to 35,000 jobs in 2007 Wachovia

15. Wachovia Economics Group 15 Charlotte Unemployment remains near the national average Wachovia

16. Wachovia Economics Group 16 Charlotte Home price growth has moderated Wachovia

17. Wachovia Economics Group 17 Charlotte Population growth has surged during the past few years, reflecting Charlotte’s positive buzz and troubles elsewhere Wachovia

18. Wachovia Economics Group 18 Office Vacancies Charlotte has one of the lowest downtown vacancy rates of any metro area Wachovia

19. Wachovia Economics Group 19 Industrial Vacancies Industrial vacancy rates are trending lower Wachovia

20. Wachovia Economics Group 20 Appendix

21. Wachovia Economics Group 21  Monthly Outlook  Weekly Economic & Financial Commentary  Special Reports  Economic Indicators  Global Commentary  Regional Commentary  Chief Economist List  To join any of our research distribution lists please email us:  wachovia.economics@wachovia.com wachovia.economics@wachovia.com Distribution ListsRecent Special Commentary A Sampling of Our Recent Special, Regional & Industry Commentary Economics Group Publications Appendix

22. Wachovia Economics Group 22 U.S. Macro Economy  Comprehensive Coverage of the U.S. Economy  Monthly Economic Forecast  Weekly Analysis & Outlook  Timely Commentary on Daily Economic Data Releases Global Economies  Macro Level Coverage of Major Foreign Economies  Macro Forecasts of 11 Economies  Monthly Forecasts of 19 Dollar Exchange Rates  Weekly Analysis & Outlook U.S. Regional Economics  Regional and MSA Level Expertise  Extensive Coverage Across the Wachovia Footprint  Ground level Analysis & Commentary of Local Markets Industry  Coverage Across CIB Industry Groups  Regular Commentary on Economic Developments by Industries Economics Group Coverage Real Estate Industrial Growth Consume r & Retail Energy & Power Financial Services MediaHealthcare Tech Economics Group Appendix

23. Wachovia Economics Group 23 John E. Silvia, Ph.D. Chief Economist  704.374. 7034  john.silvia@wachovia.com john.silvia@wachovia.com  U.S. Macro Economy  Interest Rates  Monetary Policy  704.383.5635  mark.vitner@wachovia.com mark.vitner@wachovia.com  U.S. Macro Economy  Real Estate  Regional Economics: State & MSA Level  704.383.3518  jay.bryson@wachovia.com jay.bryson@wachovia.com  Global Economies  Foreign Exchange Mark Vitner Senior Economist Jay H. Bryson, Ph.D. Global Economist Sam Bullard Economist  704.383.7372  sam.bullard@wachovia.com sam.bullard@wachovia.com  Desk Operations  Financial Services  704.383.6805  azhar.iqbal@wachovia.com azhar.iqbal@wachovia.com  Quantitative Macro-Economic Modeling Anika Khan Economist Azhar Iqbal Econometrician Adam G. York Economic Analyst  704.715.9660  adam.york@wachovia.com adam.york@wachovia.com  U.S. Macro Economy  Real Estate  Industrial Growth & Services  704.374.4407  tim.quinlan@wachovia.com tim.quinlan@wachovia.com  U.S. Macro Economy Tim Quinlan Economic Analyst Wachovia Corporation Economics Group publications are distributed by Wachovia Corporation directly and through subsidiaries including, but not limited to, Wachovia Capital Markets, LLC, Wachovia Securities, LLC and Wachovia Securities International Limited. The information and opinions herein are for general information use only. Wachovia does not guarantee their accuracy or completeness, nor does Wachovia assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice, are for general information only and are not intended as an offer or solicitation with respect to the purchase or sales of any security or as personalized investment advice. © 2008 Wachovia Corp. Economics Group Appendix  704.715.0575  anika.khan@wachovia.com anika.khan@wachovia.com  U.S. Macro Economy  Consumer & Retail  Non-residential Real Estate

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