I returned from my first Market Outlook in Chicago this week very enthusiastic about the forecasts the presenters made for the next couple of years.
According to Allan Beaulieu of ITR Economics, we can expect relative stability and growth over the next few years, and those who invest and expand their businesses now will be able to ride out the downturn expected in 2019. While much of the growth in power generation including nuclear will be overseas, it was clear from the presentations by Kevin Geraghty and John Spears that North American valve producers should be able to take advantage of the drive to deliver reliable electricity to people in the developing world. Even the petrochemical industry is seeing positive growth in North America, thanks in large part to the natural gas boom (no pun intended).
So I have to admit I was a little confused when I picked up a newsmagazine at the airport and read that Economist Paul Krugman is among several experts singing the blues, arguing that America’s “ongoing malaise is a depression and not merely a recession.”
Now I am certainly no economist; I have trouble balancing my bank account. So I most definitely cannot say with any authority that Allan Beaulieu has an inside track that Paul Krugman does not. But it seems to me that attitude and expectations do have a big effect on economics. After all, if we’re feeling optimistic, we would follow Beaulieu’s advice and invest now to position stronger in the future. However, if we believe Krugman is right, that the country is actually in a depression, the tendency would be to hold onto whatever we do have in a kind of personal protectionism.
When we do that, though, we self-fulfill the prophecy of economic downturn, because that means you’re not hiring or investing in a business or spending, all of which are necessary to spur growth. If you’re among the 69% of the American population who thinks we’re still in a recession, chances are you’re going to be pretty careful with your money, even if it means foregoing opportunities.
Since that seems counterproductive, I’m turning back to my notes from the Market Outlook workshop to rejuvenate that feeling of prosperity with which I left the Windy City. I’ll leave blues singing to the experts.
If you were at the Market Outlook workshop, I’d love to hear your thoughts on the forecasts, and if you weren’t, contribute your personal thoughts about the state of growth (or not). What’s your position?