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Academics who study the Great Depression attribute the phrase “When the U.S. gets a cold, the world gets pneumonia” to a variety of sources.

Regardless of who originally said it, the phrase has become a truism pundits repeat whenever the world’s largest economy posts poor, or even mediocre, economic statistics.

It’s been pulled out over the past few months as markets wobbled on poor news from Europe, Russia and China – as well as persistent concerns about when the U.S. economy would truly recover. It hit the print pages and airwaves consistently in the weeks, days and hours leading up to yesterday’s announcement that the U.S. Federal Reserve would end its quantitative easing program.

Read: Fed ends QE, sticks to interest rate plans

Those questioning what the Fed will do with the trillions worth of bonds and mortgage-backed securities it bought during QE got their answer this morning when the Commerce Department reported a 3.5% jump in U.S. economic growth.

With the U.S. now posting its strongest six-month expansion rates since 2003, its central bank will likely sit on those assets and sell them when it can make a profit. And that’s probably what it always intended to do. The mantra of buy low and sell high works on a lot of levels.

But the persistence of the jobless recovery that’s plagued economies in North America and Europe has caused many to miss what was going on just beneath the bad news.

Concerns over fewer traditional manufacturing jobs masked notice of new ultra-high-tech factories being opened in pockets of post-industrial hell holes like Detroit, Pittsburgh and Philadelphia. The firms embarking on these ventures are world leaders, and will help drive continued growth for quarters to come.

One Canadian economist has taken notice. Peter Hall, chief economist for Export Development Canada, has boldly called for overall U.S. growth of 3.6% in 2015. That’s between 10 and 50 basis points higher than other economists.

Read: Will new U.S. mortgage rules drive economic recovery?

Hall points to pent-up demand for hard goods and housing as key drivers. It’s a good call, since longtime job seekers are finally moving to permanent employment and will at last make purchases that in some cases have been deferred since 2009.

“For the first time in five years, confidence has staged a solid return to levels consistent with sustained economic growth,” Hall writes. “In just over a year, indexes of both consumer and business confidence have moved from recessionary levels into the normal zone.”

Further, Hall opines that if U.S. companies start perceiving current tight levels of industrial capacity are causing them to forgo profits, they’re likely to bring new capacity online. “Firms have already begun to invest, so their suppliers need to wake up.”

Combined with a slight dip in the loonie, which the ECB expects will hover around 90 cents for two years, these improvements are good news for Canada’s export-centric economy. Our consumers remain over-leveraged, but if wages rise in response to improved export demand, households should be able to meet obligations to creditors and even get ahead.

Read: Where to find investment risk

It’s also good news for economies worldwide, and it ultimately can take the wobble out of equity markets. Nearly everyone sells to the U.S. – when Americans get over their cold and start spending, the world’s cash registers ring.

Plus, the end of quantitative easing means interest rates will make corporate bonds, private debt and stable fixed-income products more viable options for Canadian investors.

Originally published on Advisor.ca

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