Billionaire investor George Soros attributes part of his favorable economic outlook for the U.S. to the nation's shale resources, he said in a weekend TV interview.
[The economy] definitely shows some signs of revival, Soros said on CNN's Fareed Zakaria GPS. Very important is the revival of shale gas and shale oil as a cheap source of energy which has made manufacturing more competitive [and] also the fact that you now had several years of no wage growth, so wage disparities have been reduced, and so all of this is bringing a very welcome relief.
Soros, 81, who's made billions over the decades through his hedge fund, spoke briefly about the nation's economic outlook as it compared to the rest of the world, noting that lower energy prices are a boon to American manufacturing.
In January, the Institute of Supply Management's purchasing manufacturing index showed an increase of one percent over December.
During the same time, the economy grew for the 32nd consecutive month while January's increase meant the manufacturing sector grew for the 30th consecutive month.
Brad Holcomb, chair of ISM's Manufacturing Business Survey Committee, who writes the institute's months manufacturing reports, said the 350 manufacturing companies surveyed each month report to him the oil and natural gas boom is benefiting their output.
In general terms, low energy prices mean factories and manufacturing centers across the country spend less on production and utility costs, meaning it costs them less to operate their factories and thus manufacture their goods.
Despite the optimistic outlook, Soros took a shot at congressional Republicans who have proven themselves more keen on ousting President Barack Obama rather than promoting economic recovery.
I'm worried that the politics of the election are going to interfere and put a lid on this because the Republicans don't want to face elections [where] Obama can claim to have seen the economy recover, Soros said. They will continue to push for austerity, no new taxes and therefore cutting of services, which will depress economic activity and employment.
The ISM report, released this month, said the country's manufacturing sector was starting the new year off on a good note, with facilities reporting growths in new orders, production and employment.
In Monday trading, natural gas continued its downward trend of recent months. At mid-day, natural gas had fallen a nickel, or 1.82 percent, trading at $2.43 per million cubic feet.
Crude prices climbed $1.39 or 1.41 percent to $100.08 a barrel.