He says he wrote the book because of what he considers to be "simply too much" pessimism from the media - and other economists, for that matter - about the U.S. economy. "We do face serious challenges. However, I see a more optimistic future for the U.S."

He recently sat down for a question-and-answer session on a variety of financial topics.

In your book, you note that the primary contributor to the strong U.S. economic growth of recent years has been American consumers, many of whom have piled on huge amounts of debt. Do you have any concerns about how Americans in their 20s, 30s and 40s will fare in retirement as a result?

Consumer spending represents 70 percent of all U.S. economic activity. There are concerns about the use of debt by Americans, however, some of the traditional debt measures are distorted because many Americans use credit cards monthly to generate points or frequent-flier miles and then pay off those balances at month-end.

EconAmerica discusses the idea that incredibly tight labor markets in coming decades will see "enlightened" employers . . . those who want to keep their skilled employees on the job for years to come . . . pay their employees better, provide greater income incentives and provide stronger benefit packages.

This issue is one of the four "Silver Bullets" upon which the book is based.

Will these younger age groups have the same retirements their parents did? Your book suggests they won't unless they start saving now.

Younger people today will face longer retirements because they simply will live longer. Millions of younger people also realize that they are more responsible for their retirement funding than are their employers and the government.

Your book touches on dual-income households, and you suggest that many families want to have someone home with the kids but think that both spouses need to work to make ends meet. Do you think there are a lot of families in Utah who might do better on only one income, not to mention that kids may get better care with a parent instead of a day care worker?

I think many people would be shocked by the lack of net additional income that results from both parents working full time. When one factors in higher taxes, costly day care, greater transportation costs, extra clothing expenses and expanded dining out and prepared-food costs, the difference in net incomes between one-income and two-income households is largely gone.

Other issues, including the need for social interaction or the sense of work-related accomplishment, may be the stronger reasons for both parents to work, not greater income.

What do you think is the long-term outlook for interest rates, especially mortgage rates? They are up from historic lows but are still reasonable.

One of the other key points in EconAmerica is that the Federal Reserve faces enormous pressure from U.S. financial markets to keep inflation low. Prior to joining the Fed, [Chairman] Ben Bernanke favored "inflation targeting," or establishing a specific target range for core inflation, deemed to be 1 percent to 2 percent annually.

Although Bernanke has not proposed this while at the Fed, the bond market is compelling him to keep inflation within or very near that range.

As a result, low inflation is highly likely in coming years. Low inflation typically suggests low, long-term interest rates.

This is a positive prospect for home buyers and business borrowers.

What do you think of the job Bernanke is doing overall?

He stumbled a few times during 2006's first half but has regained solid footing. For example, at a cocktail party he made a comment to a well-known CNBC-TV business reporter about how financial-market players had misunderstood some comments he made earlier in the week. She reported his comments the following morning, which shocked the markets and embarrassed Bernanke.

His determination to keep inflation in check was also questioned early in his term. His credibility with financial markets is now high, with the current credit crisis his first major test. He will do well in coming years.

Do you see any warning signs that our tremendous bull market is nearing an end? Your book seems very optimistic about the stock market as a way to grow your money.

I have been publishing highly optimistic forecasts for the stock market for years, with the market always exceeding my forecasts. Another of the Silver Bullets in EconAmerica is that the stock market will do very well in coming years as baby boomers and younger generations save aggressively (through 401(k)s and equity investments) for retirement.

What do you see as the largest single threat to the nation's economy in the next several years?

The largest threat until the past few months was a major terrorist "success" on American soil. More recently, the greater threat is if the global anxiety in credit markets, especially the American home finance market, were to become much more serious. This is unlikely to happen because the underlying fundamentals of the American and global economies remain solid.

The Federal Reserve and other major central banks around the globe also have plenty of ammunition to keep any escalation of the crisis under control.

Any thoughts on how the subprime lending debacle will play out over the next year, nationally and in Utah?

Roughly 14 percent of subprime mortgage loans (those made to the most risky borrowers) are delinquent, while subprime mortgages make up roughly 14 percent of the American mortgage market. As a result, we are talking about 2 percent of the nation's housing market in distress, a manageable total.

Tighter lending standards tied to the global-risk anxiety are actually the larger issue. It is likely to be early to mid-2008 before we hear consistently better news regarding home prices and home finance coming from the nation's media. Much of the home price weakness is in California, Florida, Arizona and Nevada, states where average home-price gains of the past five years of more than 90 percent were nearly twice the average American home-price gain. It is no surprise that these states find prices under pressure.

Strong Utah home-price gains, the nation's strongest rate of job creation and less dependence on subprime loans suggest Utah will survive the so-called subprime crisis well.

Why does Utah continue to have one of the nation's highest rates of bankruptcy, even as our economy is booming? We also continue to have one of the highest rates of mortgage fraud. Will the state ever escape these dubious distinctions?

Utah's bankruptcy level will always be among the 10-20 worst for a number of reasons. These include the fact that Utahns have roughly 50 percent more children per adult than the national average, placing great pressure on finances.

Utahns also tend to marry younger and have children sooner, adding to the pressures.

The general willingness of Utahns to be too trusting of what they see and hear also keeps the state near the top in terms of fraud. If it sounds too good to be true . . . it is.

lesley@sltrib.com