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Quarterly Newsletter - Summer 2013



At long last we are witnessing growing confidence suggesting that the worst might be over!

The American economy still is the power plant that drives global growth, and the signs are now much more positive and point to a sustainable recovery.  Consumer spending, so important for the US economy, has seen a very welcome resurgence.  With personal debt back to more normal levels, the Americans this year are spending roughly twice as much as they did last year.  Unemployment is down, despite the fact that Washington continues its policy of reducing job numbers in state and local government.  Even the property market seems to have recovered, with foreclosures in the first quarter down some 25% when compared with last year’s Q1, and house prices are rising.

Of course, there are regional variances when it comes to employment and house price figures, as is evidenced by Detroit filing for bankruptcy earlier today.  For decades, it had been the hub of the American automotive industry, but the “Motor City” has seen a reversal of fortunes in recent times.   General Motors, who in the 1950s was the world’s largest company, filed for bankruptcy only four years ago; it has since re-emerged following a state assisted “pre-pack” reorganisation.  Detroit’s population has shrunk by some 60% and 80,000 properties have been abandoned.  It just proves that even the biggest concerns – be they firms or municipal authorities – are not immune to calamitous downturns.

In fact, US corporations are still reluctant to invest heavily ...
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