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Midwest and Michigan Economic Outlook

Midwest and Michigan Economic Outlook. Dennis A. Johnson, CFA Chief Investment Officer. Comerica Asset Management Group An Asset Management Organization .

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Midwest and Michigan Economic Outlook

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  1. Midwest and Michigan Economic Outlook Dennis A. Johnson, CFA Chief Investment Officer

  2. Comerica Asset Management GroupAn Asset Management Organization • Headquartered in Birmingham, Michigan, Comerica Asset Management Group manages an estimated $24.2 billion in client assets as of June 30, 2012. • Comerica Asset Management Group is the largest investment management firm in Michigan according to a recent survey by Crain’s Communications. This material is for use in one-on-one presentations with eligible investors only.

  3. Midwest Economy 3

  4. Midwest labor markets improving; unemployment rate below the national average

  5. Midwest manufacturing economy is outperforming the national average Source: Federal Reserve Bank of Chicago

  6. Export demand for agricultural commodities is good for the Midwest economy

  7. Midwest housing prices are rising

  8. Midwest housing market has bottomed

  9. Moderate inflation pressure in the Midwest

  10. Michigan Economy 10

  11. Michigan’s economic growth is outpacing 88% of the U.S.

  12. Michigan’s economic recovery is continuing Source: Comerica Economics Department

  13. Michigan’s fiscal position has improved • Fiscal year 2011/2012 General Fund/General Purpose Budget resulted in a surplus of $696.8 million. • Fiscal year 2011/2012 School Aid Fund Budget resulted in a surplus of $251.9 million. • A budget surplus is projected in the 2012/2013 Budget. Source: Michigan Senate Fiscal Agency

  14. Auto sales are recovering

  15. Automobiles are more affordable Source: Comerica Economics Department

  16. Manufacturing in Michigan is picking up

  17. Detroit is on the “road” to recovery Source: Comerica Economics Department

  18. Western Michigan is recovering, as well

  19. Summary • The recovery of both the Midwest and Michigan economies is expected to continue. • Job growth should continue. • The recovery in the housing market should continue at a modest pace. • Fiscal conditions in Michigan should continue to improve and will be enhanced by an improvement in the financial performance of Detroit.

  20. Comerica’s Investment Point of View 20

  21. Investing for the future • Pay greater attention to fixed income investments in the current low interest rate environment. • Favor short to intermediate term bonds, high yield, emerging market debt denominated in local currency, high quality municipal bonds. • Equities in general and international equities specifically are becoming increasingly more attractive. • Alternative investments are attractive investments due to their ability to improve a portfolio’s risk adjusted return.

  22. THANK YOU! 22

  23. Disclosure • Comerica’s Wealth Management team consists of various divisions and affiliates of Comerica Bank and also subsidiaries of Comerica Bank including World Asset Management, Inc.; Wilson, Kemp & Associates, Inc.; Comerica Insurance Services, Inc. and its affiliated insurance agencies; and Comerica Securities, Inc. Securities offered by Comerica Securities, Inc. are not insured by the FDIC, are not deposits or other obligations of or guaranteed by Comerica Bank or any of its affiliates, and are subject to investment risks, including possible loss of the principal invested. Comerica Securities, Inc. is a broker/dealer, federally Registered Investment Advisor, member FINRA/SIPC and subsidiary of Comerica Bank. This material is for use in one-on-one presentations with eligible investors only.

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