Jul 16, 2008 10:25 am US/Mountain
CU Professor: Economy Not All Bad
Good Question: How Bad Is The Economy?
DENVER (CBS4) ―
-
-
Good Question, a regular part of CBS4 News at 10 p.m., is an opportunity for Alan Gionet to drill past the basic facts of a story and give it some depth & perspective. See more Good Question reports.
Businesses are doing better than people whose 401Ks and homes are down, but businesses are being hit by people spending less and rising oil prices. Home builders used to make about a 10 percent profit, now they are lucky if they make 2 percent, and sometimes they make nothing at all. They build just to stay in business.
An economic expert, Rich Wobbekind, from the University of Colorado, says that even though it looks bad, the economy is not as in bad of a shape as everyone thinks.
"If you think about the real economy which is job related and output related, this is actually a very minor slowdown in historical context," Wobbekind said.
He claims that in some ways, jobs are even growing in the state. He says that it is less of a significant downturn than in the 2001 recession or the 1991-92 downturn of the U.S. economy.
In fact, far more jobs were lost in the economic troubles of the late 70s and early 80s, but what did not tumble then was housing.
In Colorado there are numerous houses on the market, particularly priced under $250,000. According to the Metrostudy, which tracks housing for the building industry, the demand is half of what it was two years ago. With numbers like that, people can't help but wandering if this is our Great Depression?
"I really don't believe that, since I follow the real economy so closely meaning jobs and output, but I do think that from the financial side you can see a lot of similarities to the Great Depression," says Wobbekind.
(© MMIX CBS Television Stations, Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
Click to enlarge
Click to enlarge
Stumble It!
Reporting
Comments