Economics experts at the 47th Annual Economic Forecast Luncheon said the economies of the United States and Arizona are slated for improvement but at a slower pace than what many consumers have been hoping.
“I titled my forecast ‘The Recovery: Better Times Ahead!’ because better times are ahead. I’m getting more and more optimistic about where we’ll be a year from now,” said Joel Naroff, president of Naroff Economic Advisors, while discussing the outlook for the U.S. economy.
More than 1,000 people attended the luncheon at the Phoenix Convention Center to hear Naroff and three other economists present outlooks on the U.S. economy, financial sector, metro and regional economies, and real estate and construction.
Naroff said the country’s economic downturn and recovery can be compared to the “The Tortoise and the Hare” fable.
“We are a nation of immediate gratifiers,” Naroff said. “We want it all right away. The recovery is a race, and though we all wanted the hare, we wound up with the tortoise. A ‘V-shaped’ recovery was never possible.”
Despite the slow pace, Naroff said recovery will happen, likely showing signs of normal growth by 2012.
James Glassman, managing director and senior economist for JPMorgan Chase, said Americans have been distracted by red herrings of economic problems.
“The thing we aren’t focused on that we should be focusing on is the future deficit,” Glassman said.
Despite the mistakes in viewing the economy, Glassman said recovery remains on track and “we ought to be fairly optimistic in the next decade.”
Introduced as the “funniest man in economics,” Lee McPheters, research professor of economics at ASU’s W.P. Carey School of Business and director of the JPMorgan Chase Economic Outlook Center, said 2011 will be the best year for the economy since 2008.
“Arizona shows signs of life — we have not seen this in three years,” McPheters said. “We’re past the downturn, bumping along the bottom and at the threshold of recovery.”
Regardless of the positives, McPheters said Arizona is still 300,000 jobs away from bringing the job count back to the 2.7 million it numbered at in December 2007.
Unlike the speakers before him, Elliott Pollack, president of Elliot D. Pollack and Company, did not have uplifting news to forecast.
“(The Arizona housing market) has bottoms with 40,000-50,000 (single family) excess units,” he said. “The balance between supply and demand will not be achieved until about 2014-2015.”
This places housing and construction recovery about three years behind the growth predicted in 2011 in the areas of national economy, financial sector and regional economies.
Sponsored by a partnership between JPMorgan Chase and the W.P. Carey School of Business, the luncheon also named eight JP Morgan Chase Scholars. Scholarship of $1,000 for one year were given to eight academically outstanding students including senior economics major Star Yuan.
Yuan looked forward to attending the luncheon not only to hear the future of the financial sector but to also bridge classroom teaching and real-life applications.
“I think as an econ major we lose the fact that economics really permeates all levels of business activity,” Yuan said. “When people talk about the recession, when they talk about unemployment being high, all this has to do with what we’re learning in class — whether that’s explored quantitatively or through events like this.”
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