Steve Meads could use a few more customers like Mike Barry.

Barry is president of Twin City Fan & Blower, a manufacturer of industrial fans and ventilation systems that is growing. And Meads, president of the Twin Cities market for Bremer Bank, is financing the growth.

"Our commercial loan portfolio is still down from last year, and we're working hard to try and grow it," Meads said this week after the St. Paul-based bank reported improved first-half profitability. "We're growing deposits and we have money to lend. Most of our customers are focused on growing revenue, but it's still relatively flat.

"We are forecasting that our loan portfolio will be bigger by the end of the year. We're prospecting new business and our pipeline is stronger. We have proposals out to new customers or we're increasing business with existing customers ... but until it gets booked and funded, it's not going to show up for a quarter or two. Still, it's an indicator of increased activity."

In short, Bremer is a proxy for the slowly rebounding economy that can't expand fast enough to please forecasters, much less millions of unemployed.

Big banks, including U.S. Bank and Wells Fargo, are slowly starting to loosen credit, but are still running smaller commercial portfolios (which feed business expansion) than they did a year or two ago. Meanwhile, TCF Bank, which has taken some market share, is one of the few area banks to report an increased book of commercial business.

The banks are making money again, Minnesota and national employers are adding jobs, and the stock market has held up despite some predictions of a "double-dip" recession.

Still, we're not exactly snapping back quickly from the greatest recession since the 1930s.

The Commerce Department reported Friday that economic output grew at a 2.4 percent rate in the second quarter, down from 3.7 percent in the first quarter, and below estimates.

Second-quarter corporate earnings were strong, business spending is growing and the stock market is selling at a historical discount, U.S. Bank economy watchers noted in a bulletin to high-end clients on Thursday. But consumer sentiment softened in July, according to the monthly University of Michigan survey. And retail sales are drab.

Small wonder. Working stiffs lucky enough to have a job are paying down debt, and employers only recently have started to pass out raises and slowly add employees after two years of freezes and cuts. Even the rich are watching their spending.

In short, we're slowly recovering, but confidence about the future has yet to replace the economic and human trauma of three years of foreclosures, layoffs and many well-paid economic commentators who seem to be invested in a darker future. And that's not just confined to anti-Obama Fox News.

Brian Bethune, chief U.S. economist at IHS Global Insight, a respected, nonpartisan consulting firm, said Friday on Yahoo's Tech Ticker that a slowing of economic growth can be expected after a period of expansion.

Bethune and most other economists believe the economy will grow by up to 3 percent this year, with some acceleration this fall.

"A lot of the leading financial indicators indeed are positive, but some of the current indicators we are seeing, like employment and consumer confidence, are weak," Bethune said.

A study by the Milken Institute, an independent economic think tank, predicted that economic expansion will exceed 3 percent, not just this year, but in 2011 and in 2012 as well. Milken points to growth in developing countries for U.S. exports, improved business confidence and low interest rates as signs that the economy is strengthening.

The fingers are crossed.

Neal St. Anthony • 612-673-7144 •