economist told an educational forum.

Faced with a market were investors are bullish on prospects for growth, inflation and interest rates, Norman Robertson said the US has seen a unique economic expansion.

After one of the longest periods (six years) of continued, though modest, expansion since the Second World War, none of the expected market excesses that normally lead to an economic downturn have been evident.

The Gross Domestic Product has risen at about 2.8 percent as the country seems to have averted the boom/bust cycle that is the normal scenario in the economy.

He credits the Federal Reserve's anti-inflation policies with allowing the economy to grow at a moderate rate, without generating the excess demand that "as often as not is the harbinger of inflation and economic recessions.'' The free trade advocate said the Fed has arguably reduced the magnitude of the fluctuations in economic activity, but the economy was slowing down.

Competition, a rapid growth of private label merchandise and fast growing discount chains have made it more difficult for companies to pass on cost increases. And "baby-boomers'' are at the age where they have cut back their spending.

Strong levels of employment have quite unusually failed to push up wages and prices as employees see corporate restructuring and downsizing.

Mr. Robertson forecast: "When you look at all the forces that seem to be at work...inflation for 1997 will be something in the range of between two and three percent.'' The rise in manufacturing production in the US over the last 21 months consisted of almost nothing but computers and electronics, a stagnation in manufacturing that should not go unnoticed.

The level of debt is very high, risking the curbing of the consumer appetite.

If demand slows further, inventories will grow, and cutbacks could occur.

He said some people believe the economy will speed up, but he is willing to say that 1997 will pass without an economic downturn, with growth rates of about 2.0 to 2.25 percent.

Mr. Robertson added, "That's less than our potential, but still pretty good for an economic expansion that started way back in the spring of 1991.'' He believes the world economy will improve, boosting demand for American exports. He sees a more stable world economy of the future, when compared to the last quarter century. But he said that people cannot be overly optimistic about continued expansion, because there is a risk of an explosive rise in spending and borrowing that could be followed by a downturn.

ECONOMY ECO