“We fear that the risks of stagnant U.S. GDP growth combined with continued deflation of residential and commercial real estate asset values–and, by default, of bank balance sheets–haven’t completely disappeared. We aren’t predicting that the U.S. economy will suffer from stag-deflation. We are instead optimistic that the current recovery in the financial sector will, in short order, lead to self-sustaining, consumer-fueled U.S. GDP growth. However, we are also aware of the many contradictory signals the economy is sending, not least of all the 23 consecutive months of decline in U.S. non-farm payrolls as of November 2009.”