As posted by Austin Kilgore | 01.23.09
The country's recession is the longest and deepest in 60 years, but it will rebound in 2009, according to two economists at the Comerica Bank Economic Forecast Conference in Santa Clara, California.
Comerica Bank's chief economist Dana Johnson told approximately 600 Silicon Valley business leaders, “We should see at least a 6 percent increase in gross domestic product in the third quarter. I don't think it's at all a stretch to say that once the economy picks up steam, it will be really impressive.”
Another economist at the conference, Stanford University's John B. Shoven, agreed, but said he believes the rebound will happen in the fourth quarter of 2009.
He added as soon as investors realize the economy will strengthen in 2010, “the stock market could start to rally in the second quarter,” several months ahead of the recovery.
They both credited the economic stimulus actions taken by the U.S. Government from preventing disaster.
Johnson said, “We came within an eyelash of a catastrophic failure of our financial system.”
The economists said while President Barack Obama has surrounded himself with a strong team of economic advisors, the government won't be able to do much to prevent the unemployment rate increasing to 9 percent by mid-year.
However, Johnson said, “The federal fiscal stimulus headed our way beginning this spring...will do an enormous amount to get this economy going.”
http://www.dsnews.com/index.php/home/news_story/2459
And as my friends in the Brokerage and Lending field have heard me say "Once the lenders have finished crapping their shorts they need to get back to making loans again." But then today's LA Times has a story about one of the stalwarts of the local area multi-family lending business, First Federal Bank of CA, was stopped from making new loans.
This decision is in response to regulators demands. They have stopped making loans. What are those Regulators thinking??? This is a stronger institution. And almost all multi-family borrowers are paying the loans. Multi-family apartment buildings are Not purchased by speculative fly by night flippers who over leveraged and got upside down.
Sometimes I scratch my head. Most often when government regulations collide with the reality of what they actually accomplish.
If the government is spending 700 Billion to keep the banks lending... Why are they forcing our local bank to stop making loans?
Who sends the complaint letter to Obama?
All will work out. I hope the economists above have the reading right. So if you can get a loan. Now is not to far off from the bottom if 2010 is the start of the ride back up.
Keith L.
www.REList.net
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