Local & Regional
Mon July 2, 2012
Economic Warning Signs Ahead
There are some economic trouble spots being indicated in the latest nine-state mid-America region survey. The survey is complied in Omaha at Creighton University. Supervising the project is Doctor Ernie Goss.
“Since the end of the recession in 2009, the businesses that we survey have benefited from healthy farm income and exports. While agriculture income continues to grow at a positive, but slower pace, global economic problems are pushing new export orders into negative territory. Europe’s economic problems are spilling over into the region via weaker commodity prices generated by the advancing U.S. dollar. Recent gains in the dollar have made U.S. goods less competitively priced abroad,” said Ernie Goss,
The report released today shows whole prices have dramatically dropped. “The degree to which inflationary pressures have cooled has surprised me. This is an important signal and indicates that the Federal Reserve (Fed) can become more aggressive in its stimulation of the U.S. economy without any significant inflation fears. However given current short and long term interest rates, there is little the Fed can do to push growth higher especially with the national elections ahead. The last thing the Fed wishes to do is enter the political fray by abruptly changing policy,” said Goss.
While growth is slowing, he doubts there is anything that the Federal Reserve can do to stimulate the economy.
Here in Oklahoma, Goss says the sooner state will continues to see growth during 2012, but it will be at a much slower pace. “Oklahoma’s job additions for 2012 are more than double that for the same period in 2011. Durable goods manufacturers in Oklahoma are benefiting from exports and healthy expansions in recent growth in energy income. Growth for the rest of 2012 will be positive but down from the first half of 2012 as exports weaken and energy gains soften,” said Goss.