CEOs See Protectionism as Most Serious Economic Threat Survey of CEOs Predicts Moderate 2007 Economic Growth WASHINGTON, DC - Protectionism again ranked as the most serious threat to continued growth of the U.S. and global economies according to the latest Biannual Financial Services Forum CEO Survey. The Financial Services Forum comprises the CEOs of twenty of the world's largest financial institutions. Concerns about subprime lending were moderate, while rising health care costs and frivolous litigation followed protectionism as the most significant threats to U.S. economic growth. An unpredictable litigation environment was cited as the most serious threat to the competitiveness of the U.S. capital markets, while concern about Sarbanes-Oxley was more moderate as the SEC and PCAOB have recently taken steps to address problems with the implementation of the internal controls provisions of the law. Trade liberalization topped the list of priorities for keeping the U.S. economy competitive with litigation and regulatory reform, continued lower tax rates, and improved education also high on the agenda. The CEOs see 2.53% real GDP growth in the U.S. for 2007 overall and predicted 1.98% growth in the first quarter of the year. Most of the CEOs predicted that the Federal Reserve would keep the federal funds rate at 5.25% at their next meeting. However, half of the CEOs expected one rate cut to 5.00% by the end of 2007, while one out of three expected that the Fed would hold at 5.25% through the end of the year. On average, the CEOs predicted that the Dow Jones Industrial Average would finish the year at 12,903. The Financial Services Forum is a non-partisan financial and economic policy organization comprised of the chief executive officers of 20 of the largest and most diversified financial institutions with business operations in the United States. The Forum works to promote policies that enhance savings and investment in the United States and that ensure an open, competitive, and sound global financial services marketplace. Click here for a downloadable version of the BiAnnual CEO Survey Biannual Financial Services Forum CEO Survey - April 2007   Section I: The Global Economy   1a. How would you characterize your expectations regarding growth in the global economy over the next year?   1b. How would you characterize your expectations regarding growth in the global economy over the next 2-3 years?   2. Please rate the following as threats to global economic growth.   3a. Please rate the following regions in terms of their expected contribution to global economic growth over the next decade.   3b. Please rate the following economic factors in terms of their expected contribution to global economic growth over the next decade.   4. Please rate the following in terms of the investement opportunity they represent.     Section II: The U.S. Economy   5. At what rate do you expect U.S. real GDP to grow? Q1 2007 - 1.98% 2007 (overall) - 2.53%   6a. How would you characterize your expectations regarding growth in the U.S. economy over the next year?   6b. How would you characterize your expectations regarding growth in the U.S. economy over the next 2-3 years?   7. What is your expectation regarding the employment situation in the United States over the next year?   8. What is your expectation regarding the inflation rate in the U.S. over the next year?   9. What is your expectation regarding the Fed. funds rate at year-end 2007?   10. At its next meeting, dyou think the FOMC will:   11. Where do you expect the Dow Jones Industrial Average to be at year-end 2007? 12,903   12. Please rate the following as threats to the continued expansion of the U.S. economy.   13. Please rate the following policy goals in terms of their value to continued U.S. economic growth and enhanced competitiveness.   14. Over the next few years, will China be more of an opportunity as a new market and a source of labor and resources, OR more of a threat to American companies, and American culture and influence around the world? Please rate on a scale of 1 to 5 with "1" being a threat and "5" being an opportunity. April 2007: 3.85 Oct. 2006: 3.78   15. What degree of importance do you attach to corporate social and environmental responsibility?   16. Please rate, as a percentage, the risk of a recession in the U.S. economy this year. Risk of U.S. recession: 24%   17 Please rate the following as threats to the competitiveness of U.S. Capital Markets.   Click here for a downloadable version of the BiAnnual CEO Survey

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