Economic Health and Recovery Spotlighted at Virtual Economic Forum
Business leaders across the nation have been closely watching the state of the economy looking for signs that confirm economic recovery as they plan for the future.
Western Alliance Bank and one of its divisions, Alliance Association Bank, recently hosted a virtual Economic Forum to help answer pressing questions and put the recent economic data in greater context. The virtual event featured Dr. Christopher Thornberg, founder of Beacon Economics, a leading independent economic research and consulting firm.
Providing thoughtful, evidence-based analysis, Dr. Thornberg, one of the nation’s most prominent economists, investigates the latest data, along with historic trends and current market conditions to provide forward-looking insights on what could be expected in the quarters ahead. More specifically, he zeroes in on analyzing how pre-pandemic conditions are affecting current economic circumstances, examining the impact of the second surge, addressing fears of another great recession, evaluating the impact of policy decisions and stimulus packages, and anticipating a timeline for recovery.
Dr. Thornberg also offers insights into evolving market conditions that will affect overall recovery. These include analyzing anticipated unemployment trends, commercial and residential real estate health and his projections for recovery in key sectors of the economy, including travel and tourism, retail and more. Among the trends, he reports that:
- The COVID-19 recession is over and the nation is in full recovery mode with a return to normal levels of economic activity by mid-2021.
- Despite a second surge in areas across the U.S., the economy has not seen a second downturn. In fact, July shows stability in credit card numbers, increases in home sales, improved spending numbers and more.
- Even before the pandemic, Americans were saving at record rates not seen since the early 1990s and financial obligation ratios were close to historic lows.
- The combination of spending declines and the Federal government’s massive fiscal stimulus program have caused commercial deposits to expand by a massive $2.3 trillion in six months. According to Dr. Thornberg, this is the dry powder that will fuel a rapid recovery once the virus is brought under control.
- Potential points for concern include the possibility of a bump in interest rates, a stock market correction and concerns around Medicare and social security funding.
- Additional economic recovery expectations include:
- Anticipated baseline GDP growth of 26% in Q3/2020 and an additional 8% in Q4.
- Unemployment is anticipated to be below 7% by the end of 2020.
- Little impact is expected for long-run assets such as real estate and there are no signs of distress (bankruptcy) according to the latest numbers available.
- Unfortunately, brick-and-mortar retail, restaurants and tourism are projected to continue to lag.
To learn more from Dr. Thornberg about the impact of COVID-19 on the nation’s economic health and what can be anticipated in the quarters to come, watch Western Alliance Bank’s Virtual Economic Forum below.
Alliance Association Bank, a division of Western Alliance Bank, provides financing solutions to the growing community management and homeowner association industries with a high level of expertise and responsiveness. This specialized organization offers a wide range of innovative banking products and services designed to create efficiencies, reduce costs and increase revenue. Western Alliance Bank, Member FDIC, is the primary subsidiary of Phoenix-based Western Alliance Bancorporation, one of the country’s top-performing banking companies. Western Alliance is again #1 best-performing of the 50 largest public U.S. banks in the new S&P Global Market Intelligence listing for 2020 and ranks high on the Forbes “Best Banks in America” list year after year. Serving clients across the country wherever business happens, Western Alliance Bank operates individually branded, full-service banking divisions and has offices in key markets nationwide.