Recent reports on construction spending
signaled continued strength in both residential and nonresidential investment, which
are key components of GDP, although we may see a temporary set-back when the
data is released for January due to difficult weather conditions in many parts
of the U.S.

The purchasing managers’ index—strong
orders, lean inventories, and a rise in employment to a 30-month high—also indicate
a good first-quarter 2014.

Mind the tax hikes instituted last
January (2013) will not be repeated this January. The economy grew faster in 2013
despite those higher taxes; thus, the relative absence of a tax shock this January
bodes well for 2014.