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Expert: Colorado Insulated From Some Economic Woes

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Jun 20, 2008 8:04 am US/Mountain

Expert: Colorado Insulated From Some Economic Woes

Written By Tom Mustin
Reporting
Tom Mustin
DENVER (CBS4) ― For months there have been dire predictions about the U.S. economy and the possibility it is heading for a recession. CBS4's Tom Mustin sat down with a local financial adviser who says when it comes to Colorado's economy, the future is looking bright.

"Colorado is a very desirable state," says Chris Blackwood, managing director of Denver's Davidson Fixed Management. "It's a growth state. Colorado has done better in almost every sector of the economy than the nation."

Blackwood has the numbers to back it up. He says for decades, Colorado's economy has grown faster than the rest of the nation. He believes that trend will continue because of the state's diversity.

Blackwood sights record tourism, along with education and health services, and even the oil industry growth in Colorado as reasons for optimism.

"We're frankly benefitting from high oil prices," says Blackwood. "The oil and gas sector has added the highest percentage of jobs of any sector here in Colorado."

He also points out that 65,000 new workers came to the state last year. He says because of that growth, even Colorado's housing sector has been relatively stable, despite a few bumps.

Blackwood says the shrinking inventory in every major metro area county is all part of the adjustment process.

"You talk to homeowners, and they're definitely suffering," he says. "But the number of planned developments in the Denver metro area haven't really declined. Developers and homebuilders have to ride this out and I think they will."

Blackwood has been studying the Colorado economy for years. In the 1980's, he served as the senior economist to Gov. Richard Lamm.

Blackwood says the nation's housing problems can be traced to relaxed lending standards that allowed easy credit. He says there's no quick fix for the nation's economy. He believes until the nation's housing inventories get worked out and oil prices level off, Americans will continue to suffer.

"We're not going to see rapid growth in the next year. All these problems are sort of like an anchor," Blackwood says. "We're dragging along the bottom but we're having a hard time pulling the anchor up."

Blackwood also says even though the U.S. economy is going through some tough times, he doesn't believe the country will enter a recession this year.

Meanwhile, as the rest of the nation tries to recover, he believes Colorado's economy is in relatively good shape. Because of the state's diversity, Blackwood says Coloradans benefit from what he calls a "protective buffer" that other states don't have.

"In the long run, this is a good place to be."

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