Economic & Equity Update

January 28, 2010
Steven C Wieting, Managing Director US Developing Markets Economics

Despite the most severe postwar downturn and a temporary collapse in oil prices, it increasingly appears the U.S. current account deficit found a floor at -2.75% of GDP in 2Q 2009.
Smaller cross-border imbalances are not a concern for their own sake.
Net national savings weakened in the crisis rather than improved as larger fiscal deficits offset rising private savings.
For more, please read the full report below.

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January 21, 2010
Steven C Wieting, Managing Director US Developing Markets Economics

A sharp improvement in financial conditions within 2009 left 2010 well positioned to be a better year for the real economy.
Manufacturing production rose at a 7.4% annualized rate in 2H 2009 while real consumer spending likely rose at a 2.25% rate.
While inventories have plunged and production should continue to rise, inventories are already stabilizing given the sharper upturn in output.
For more, please read the full report below.

For more information, please contact your Financial Advisor.

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Morgan Stanley Smith Barney