Mark Lennihan, File, Associated Press
In this Nov. 23, 2010 file photo, a woman looks at a DKNY holiday window display, in New York. Retail spending is expected to rise 3.0%-5.0% versus last year.

This week's Tea Leaf is our semi-annual alphabetic view of the U.S. economy. Global ABCs will soon follow …

America — Economic growth is likely to continue at just better than a snail's pace, especially when considering the massive amounts of fiscal and monetary stimulus in the economy. Still, the U.S. economy, for the moment, is improving while Europe, China, and much of the world slows.

Budget Deficits — I'm old enough to remember President Gerald Ford holding a news conference in the mid-1970s. He used a pointer and a large chart to explain why the nation might run a budget deficit as high as $40 billion that year. We now do that every 11 days.

Consumer Confidence — Still fragile with high unemployment, soft home values, and anxiety about the size and direction of government. A "recession of confidence" remains front and center.

Dollar — Holding its own as the euro slides.

Energy — Greater use of abundant natural gas, better access to oil and gas in Alaska and the Gulf of Mexico, and major progress in "clean burn" coal technology must be part of the equation in coming years … in addition to alternative sources.

Federal Reserve — Its key short-term interest rate has been at an historic low of 0.00%-0.25% for three years now, with no change expected anytime soon. Will the Fed be able to rein in extraordinary money growth when necessary in coming years?

Global Economy — It's all about Europe these days as more euro nations feel the wrath of wary financing markets. You would think the U.S. might just take a hint as to what might be coming on this side of the pond if we don't get our financial house in order.

Housing — Home prices are expected to stabilize by 2012's second quarter. Note: I think economists have now said this for three years in a row. Maybe we will get it right this time.

Inflation — Financial market players are split as to whether inflation or deflation will be the major worry in coming years.

Jobs — A key to strong job growth in 2012? How 'bout the Administration and the Congress make some grown-up decisions about reducing future budget deficits … and then get out of the way.

Knowledge — and the Ability to Think — The key to individual success in an increasingly sophisticated economy. Ongoing education and training are now lifelong realities for many to be successful. Average annual earnings of a college graduate versus a high school graduate today? … 70%-80% higher.

Lending — Still too tight across the U.S., especially by the nation's largest handful of banks. In addition, smaller banks and other lenders are struggling with the as-yet-mostly-undefined complexities of the Dodd-Frank financial legislation.

Manufacturing — Don't be surprised if rapidly rising global costs and more competitive U.S. costs lead to a renaissance in U.S. manufacturing activity in coming years.

National Debt — The gross national debt (quite descriptive actually) now exceeding $15,100,000,000,000, combined with budget deficits exceeding $1 trillion annually, makes concrete moves toward fiscal sanity mandatory in the nation's capital.

Opportunity — Challenge breeds (it just might be a good time to be aggressive).

Politics — Childish and boorish behavior on both sides of the aisle in Washington is ridiculous … and all too typical. Can we move toward term limits?

Quarterly Economic Growth — Most forecasting economists see a 1.5%-2.5% real (after inflation) annual growth pace in 2012. The current quarter could be closer to a 2.5%-3.0% real annual rate.

Retirement — The term will take on new meaning in coming decades as more and more people "bridge the gap" (work two or three days a week) between working full-time and moving into full retirement. Millions of retirement-age baby boomers will prefer (or need) to keep one foot in the workplace for a long time to come.

Social Security — Steps taken sooner rather than later to slow down the future growth rate of spending are required. It would be great if politicians would stop calling it spending cuts … and scaring people!

Taxes — Boosting capital gains, dividend, and income tax rates on the top 3% of income earners remains the President's goal, IF he survives the 2012 election. Like it or not, these are primarily the people who create jobs and invest. The Administration's focus on "income redistribution" rather than on providing "incentives for U.S. economic growth" remains troubling.

Unemployment — Likely to remain above 8.2% during the next 12-18 months, after averaging 9.0% during the past three years. Hundreds of thousands of people who previously left the labor force after becoming discouraged could return to the labor force, keeping the rate high.

Visitors (foreign) — Tens of thousands of additional foreign residents would visit the U.S. (and spend money aggressively) if we didn't make it so hard for them to come.

Wall Street — Simply stated … I remain a long-term bull on stocks.

Xmas — Retail spending is expected to rise 3.0%-5.0% versus last year. As before, aggressive discounting will drive consumer traffic.

Youth — My parents "came of age" with Pearl Harbor … my peers with Kennedy's assassination and Vietnam. For millions of Generations X and Y, September 11 and the "Great Recession" will be forever etched into their consciousness.

JaZZ (Utah) — We used to think of them as one of the NBA's elite teams. Now they are rebuilding. Can they be any good? Like the little train … We think we can … we think we can … we think we can.

Jeff Thredgold is the chief economist for Zions Bank and founder of Thredgold Economic Associates, a professional speaking and economic consulting firm. Visit