Bob Maynard, chief investment officer for the Public Employee Retirement System of Idaho, told lawmakers this morning the coming year’s economy is widely expected to be similar to this past year: “Subdued and stumbling growth, good equity markets, flat bond markets.” He said, “2012 was pretty close to forecast. Basically the world economies muddled through. … Next year is expected to be more of the same.” For example, he said, in 2012 the S&P 500 was up 15 percent, compared to an expected 12 percent. “That’s pretty much a bullseye given the pessimism of last year,” Maynard said. “Markets again expect about 12 percent equity yields and flat bond markets.” He added, “Right now, bonds are tremendously unattractive.”

Maynard said, “The capital markets run off of expectations, not current conditions. And the current economic expectations are moderate.”

He’s among an array of economic experts and business representatives addressing the Legislature’s Economic Outlook & Revenue Assessment Committee today and tomorrow, as lawmakers begin mulling where to set the revenue estimate on which the state budget for next year will be based. After hearings today and tomorrow, the panel will reconvene on Jan. 10 to finalize its report to the Legislature.