GBC Business Outlook event Draws 300, including national business news media

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More than 300 GBC members and a contingent of national business media heard Richmond Federal Reserve Bank Jeffrey Lacker pronounce the U.S. economy in “reasonably good shape,” but in need of further credit tightening to stem inflation during the GBC’s October 30 Business Outlook conference.

Lacker’s appearance as the conference’s keynote speaker drew reporters from four national business news wires and four local newspapers to the conference at the Baltimore Convention Center. Lacker has been the sole proponent for even higher interest rates at the last three meetings of the Federal Open Market Committee.

Correspondents from Reuters, Dow Jones Newswires, Bloomberg.com and Market News International joined reporters from the Baltimore Sun, Baltimore Examiner, the Daily Record, and the Baltimore Business Journal in covering the event. Video of Lacker’s full remarks was featured on the Bloomberg.com Web site.

Lacker labeled the outlook for U.S. inflation “discomforting” as it continues to linger above the nation’s 1-2 percent comfort zone. The U.S. economy is “resilient enough to withstand further credit tightening to dampen inflation, he said. Though the nation’s housing boom has cooled, a “catastrophic” housing slump is unlikely, he added. “Outside of housing, the rest of the economy is in reasonably good shape.”

Also during the GBC conference the state’s top manager of base realignment and closure (BRAC) initiatives, J. Michael Hayes, labeled the shortage of BRAC-related construction funding as the top challenge facing Maryland.

The relocation of between 40,000 and 60,000 jobs expected to be relocated to military bases, primarily in Harford and Anne Arundel, counties will have to be supported by as much as $7 billion in public and private construction investment at Aberdeen Proving Grounds and Ft. Meade, said Hayes.

Economist Anirban Basu warned leaders in the Baltimore region’s counties to avoid pursuing growth-limiting policies that “could destroy a lot of rural heritage” by pushing BRAC-related housing growth into adjoining areas such as Cecil County that lack infrastructure for absorbing such growth.

Meanwhile, Smith Barney’s wealth management expert Jonathan Murray urged baby boomers on the cusp of retirement to make sure to continue to include stocks in retirement portfolios as inflation protection for increasingly lengthy retirements.

Murray also recommended that retirement portfolios contain, among other things, at least 5 percent of investments in commodities and hard assets.

The GBC’s 2006 Corporate Sponsor is MedStar Health. Business Outlook program sponsors were the Carroll County Department of Economic Development, Comcast, The Daily Record, KAWG&F, P.A., the Maryland Port Administration, Smart & Associates, St. Agnes Hospital, Towson University; VPC, Inc.; and Whiteford, Taylor & Preston LLP.

Bloomberg TV video of Lacker’s speech. 

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