GBC’s Fry: Entering the post-recession phase

Don Fry Commentary on WYPR

It’s difficult to rejoice over the current stock market rally when the jobless rate is almost 10 percent in our nation and 11 percent in Baltimore City. But the recovery from the recession has begun, financial experts told us at a recent Greater Baltimore Committee economic outlook event.

Emerging from charts and graphs of economic indicators is a picture of a reawakening economy, they say. But don’t expect it to return anytime soon to Dow 14,000 territory – the economy we enjoyed in 2007 before it disintegrated.

Here are some key points delivered by financial forecasters Richard Cripps, of EquityCompass, and John Jacobs of NASDAQ OMX:

• Optimism in the financial community is fueled, in part, by the re-emergence of initial public offerings – many backed by venture capital – and by rising consumer confidence. But concerns remain over high joblessness rates and a housing market that hasn’t yet shaken off its sluggishness
• The recent rally has a kind of “up is down and down is up” quality to it. The most risky stocks are way up, while quality equities are the cheapest part of the market. Experts forecast a correction in early 2010
• Foreign investor participation in the U.S. stock market is at its lowest level since 1978 because of the weakening U.S. dollar

Meanwhile, Bracken Hendricks, of the Center for American Progress, makes the case for increased business investment in the emerging “green” economy. Substantial business opportunities exist for U.S. companies willing to apply “old-economy” capital and resources to a growing global demand for “green” equipment, products and services, he says.

U.S. businesses should seize these opportunities or others elsewhere will, Hendricks warns. All speakers at the GBC event noted one fundamental issue — key regulatory policies must be decided upon so that the private sector can get to work on building “green” business plans.

… All of this is food for thought as we chart our post-recession business future.

For the Regional Business Report, this is Don Fry, President and CEO of the Greater Baltimore Committee, for 88.1 WYPR, your NPR news station.

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