The Bank of Utah’s annual Economic Outlook Breakfast gave a new perspective this year as it analyzed the global market’s effect on Utah.
Robert Albertson, chief strategist of Sandra O’Neill & Partners LP, was the keynote speaker. His address focused on the events of the recession both in America and in foreign countries and what it means for economic recovery for the U.S.
Albertson said the crisis began in the housing sector in 2006 and progressed to the financial sector in 2008. He gave several reasons why this economic crisis was different than before. The first reason being the housing market collapsed, which he said is the most influential and largest market in the country.
“If you were an economic terrorist trying to do in America and you could pick one part of it (to attack), this would be your part,” Albertson said.
The second reason is unemployment was over six percent, which he said hasn’t happened since World War II, crippling the consumer side of the economy. Albertson said the commercial side of the economy is what should take up the slack.
The last reason was the high amounts of foreign trading in the U.S. market, specifically with bills and bonds. This gave emerging economies large amounts of hard currencies that they used to further develop. He also said most of these countries began focussing more on exports as well. So while the U.S. economy tanked, other economies continued to grow.
Albertson said because of these strong emerging economies that are focused on a global market, the best way for the U.S. to grow its economy is to also focus on it. He said most businesses have some sort of component that can apply globally.
He said in order for the U.S. economy to grow there needs to be a shift from consumption to business investment, manufacturing and exports because the demand for products is outside the United States.
“Don’t think we’re going to have all our recovery in the United States because more people will get jobs and start spending on things and create more jobs,” Albertson said. “That model is over.”
Scott Parkinson, senior vice president of Bank of Utah, said these outlook seminars are an annual even the bank presents for their customers and generally there is a focus on the local economy. He said this year they wanted to mix things up to show how the global and national economy would effect Utah, which was well received.
“We were really pleased with it,” Parkinson said. “Every time you do something like this, and select a speaker like this, you hope it’s relevant to the business base and the people who attend.”
Those who attended seemed to agree that it was relevant to them. Robert Reed, sales and business development representative from Cameron Construction in Salt Lake City, said the information presented indicated that information the importance of the commercial sector in the coming years.
“We spoke about it in our office internally and felt the United Sates needs to look more globally as far as a market rather than just locally,” Reed said.
He said the nature of the work Cameron Construction does doesn’t allow them to expand globally, but that supporting companies choosing to go global will be important.