To a relatively large extent, the future hinges on whether banks return to a more normal lending environment.
If they fail to do so, then deleveraging and deflation will weigh down the growth outlook. If they do come through, then the recovery will receive a much needed capital underpinning.
Supporting the "yes, they will return to normal" camp are improving balance sheets, strong operating profits, a supportive fiscal and monetary environment, cyclical tailwinds, growing investor confidence, and the present low cost of funds.
On the "no they won't" side are an already overly indebted consumer, high unemployment levels, tightening lending standards, secular headwinds, and vestigial bank fears of another run.
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