In December, the country’s 2008 agreement on the amount of debt it can hold will expire, meaning by law the government will have to cut 4 per cent of GDP from its budget, which the IMF has warned will lead growth forecasts to be slashed.
However, Weldon, who runs the Threadneedle American and Threadneedle American Select portfolios, says he is sure politicians from both parties will agree to a deal, despite the months of wrangling in 2008 that saw the US government downgraded.
"We think the possible 4 per cent of fiscal tightening next year will not happen," he commented. "It may be resolved before the election or possibly in the lame duck session of congress between."
"However, CEOs are concerned about this and they are unsure of the capital gains tax they will have to pay, for example, meaning they are being put off hiring and investing."
"Our portfolios are structured for low economic growth but not for deep recession, which a failure to resolve the issue would lead to."
Weldon runs two portfolios in the IMA North America sector, each of which has a good track record.
Both are on the border of the first and second quartile for 10-year performance, Threadneedle American gaining 70.11 per cent over the period and the more concentrated Threadneedle American Select 69.35 per cent.
The funds have therefore significantly outperformed their S&P 500 benchmark, which is up 59 per cent over the same time.
Performance of funds vs sector and benchmark over 10-yrs
Source: FE Analytics
The manager believes that low energy prices and a strong banking sector are two key features that will ensure the US continues to grow faster than the rest of the developed world.
He said: "The US banking sector is well capitalised. They reacted to the housing crisis in much more bold fashion by facing the banks’ capitalisation in 2009."
"They have very healthy capital ratios now, so they don’t have to conduct a deleveraging of the banks as in Europe."
"In fact, banks are now starting to grow their loan books again, with many loans having been written off or paid off in the last few years."
"We think we are seeing this growth in the housing market. Anecdotally we are seeing the end of the housing problem, because some of the worst-affected housing markets are seeing demand for housing and cash prices upward of 60 per cent."
"Retail yields are high at 8 per cent. Yesterday we heard Blackstone is preparing to create a company to invest in property, so it can benefit from the yields."
According to Weldon, this is only possible because of growing levels of US consumer confidence.
"Housing is at its most affordable in history but this only matters if you have confidence you’re going to retain your job," he continued.
Cheap natural gas prices, driven by technological advancements opening up shale rock formations to drilling, mean that the US is now a net exporter of petroleum products.
This has led Weldon to invest in chemicals and polymer manufacturer LyondellBasell, which he admits has added risk attached through its commodity exposure.
The manager thinks that although cheap gas is a positive for the US both economically and politically, predictions of its impact have been overplayed.
"Complete energy independence is unlikely because it is undesirable – you don’t want to exhaust your stocks," he finished.