1. The Global Economic Outlook May 2005 Jay H. Bryson, Global Economist Wachovia Corporation

2. Contributions to U.S. Growth (year-on-year rates)

3. U.S. Real GDP Components (year-on-year growth)

4. Real Spending Indicators (year-on-year growth, 3-month moving average)

5. Consumer Purchases of Oil and Gas (as percent of disposable income)

6. Household Debt (as percent of disposable income)

7. Household Financial Indicators

8. Inventory-to-Sales Ratio (months of inventories at current sales pace)

9. “Core” Capital Goods Orders (year-on-year growth, 3-month moving average)

10. Corporate Financial Indicators

11. “Core” PCE Deflator (year-on-year change)

12. U.S. Outlook

13. Monetary Policy Indicators

14. U.S. External Indicators (4-quarter moving sums)

15. Trade in Goods & Services (year-on-year growth, 3-month moving average)

16. Dollar Exchange Rates

17. Global Exports (as percent of Global GDP)

18. Imports-to-Shipments Ratios

19. Real GDP Growth Rates (year-on-year rates)

20. Chinese CPI Inflation (year-on-year rate)

21. Chinese Industrial Production (year-on-year growth, 3-month moving average)

22. GDP & Population

23. Real GDP

24. Per Capita GDP

25. Chinese Renminbi Although not necessarily imminent, the currency will become more flexible. China is slowly liberalizing its financial system. Flexibility needs to be seen in that context. Managed float? Not apparent that currency would necessarily appreciate in long run.

26. Notable Near-Term Risks Upside Synchronous global upswing in capital spending. Decline in foreign savings rates. More fiscal stimulus, especially in the Eurozone. Downside Dollar crash. Geopolitical tension (terrorism, Iran/North Korea). Spike in oil prices. Inflation scare in U.S.

27. Summary of Near-Term Outlook Global growth should be solid in 2005, albeit somewhat slower than last year. Inflation is starting to turn up, although a return to the 1970’s is very unlikely. Short-term interest rates should rise further over the next year or so. Dollar should trend even lower.