Exhibit 36: Contribution from Change in Exhibit 37: National Association of Home Builders Inventories to US GDP Growth US Housing Market Index Inventories should support growth after five quarters of The post-crisis high in builder confidence bodes well for US subtracting from GDP. residential investment. Percentage Points, 5-Quarter Moving Total —— Contribution Recession Index Level 14 4 80 5 70 + 70 60 + 64 50 + 2 40 + 11a ll a —f4 i 64 10 5 40 4 0 1981 1986 1991 1996 2001 2006 2011 2016 2002 2004 2006 2008 2010 2012 2014 2016 Data through 03 2016. Data through December 2016. Source: Investment Strategy Group, Haver Analytics. Note: Based on a monthly survey of NAHB members who rate market conditions for the sale of new homes, as well as the traffic of prospective buyers of new homes. Source: Investment Strategy Group, Datastream. National Association of Home Builders (NAHB) housing market index reaching a post-crisis high in Exhibit 38: US GDP Growth Impulse from December of last year (see Exhibit 37). Overall, we Goldman Sachs Financial Conditions Index expect this momentum to continue as the erstwhile The persistent drag from tight financial conditions over the easing in financial conditions provides a growth last two years should reverse in 2017. tailwind throughout 2017 (see Exhibit 38). Percentage Points, 4-Quarter Moving Average 1 |Forecast A Resilient US Consumer 08 4 The stars are aligned for US consumers in 2017, 08 4 as they enter the year with rising wages, higher O4 + net worth from asset price gains, historically ae li ubnet | [, low debt-servicing costs, ample savings and a 1! = al | al | confidence at a 12-year high. They also stand to | benefit directly from potentially lower tax rates u and indirectly from higher fiscal spending, a 084 topic we discuss in the next section. The above- O84 mentioned factors should mitigate the headwind wy from higher inflation. Overall, we expect private ce ee ee ee en ee consumption—a key driver of our GDP forecas