By Nicholas Ziegler, News Editor<\/p>\n
The last few weeks have been, to put it mildly, tumultuous on the financial side. When markets opened last week, the first business day after Standard & Poor\u2019s Corp.’s ratings downgrade and just a few days after the passing of the Budget Control Act of 2011, the Dow took a huge hit. By Tuesday, they were back up. Wednesday, down. Thursday, up. The markets\u2019 close on Thursday, Aug. 11, proved a curious first for the Dow, which hadn’t ever had four 400-point swings in a row before. Some have even been mouthing the words \u201cdouble-dip recession.\u201d<\/p>\n
So what\u2019s an investor, specifically one in commercial real estate, to do?<\/p>\n
\u201cTo quote Paul Samuelson, the Nobel-winning economist, the stock market has predicted nine of the last five recessions,\u201d Ken McCarthy, senior economist & senior managing director of research at Cushman & Wakefield Inc., told Commercial Property Executive<\/em>. A potential second recession is \u201ca political as much as an economic event. Our economy continues to grow, and we\u2019re not seeing excesses. While things slowed down from May of this year through July, there\u2019s little to suggest it\u2019s going to slow down to recession.\u201d<\/p>\n And that sentiment seems to be shared within the industry, despite the idea reaching mainstream discussion with articles in USA Today<\/em>. According to an Aug. 14 article in that newspaper, \u201cthe chances of the economy slipping into another recession have risen significantly, and forecasts for economic growth and job gains over the next year have been substantially downsized. \u2026 The 39 economists polled Aug. 3-11 put the chance of another downturn at 30 percent\u00a0\u2014 twice as high as three months ago, according to their median estimates.\u201d But such doom-and-gloom predictions don\u2019t seem to hold water with experts in the CRE field.<\/p>\n \u201cOverall, the recovery in the U.S. has proven exceptionally strong and momentum is still building across all sectors, while investment activity is broadening both geographically and in terms of asset quality,\u201d said Jay Koster, president of capital markets in the Americas for Jones Lang LaSalle Inc. \u201cAdd to this an improvement in debt-market liquidity and still-attractive spreads, and the second half will be even stronger than the first six months of this year.\u201d<\/p>\n McCarthy feels the same way, but has a realistic outlook.<\/p>\n \u201cWe\u2019re seeing unemployment claims decline back to 400,000, which is a good sign,\u201d he said. \u201cAutomobile sales have increased, as well. There\u2019s nervousness and uncertainty in regards to the budget deficit, despite an agreement. There\u2019s still not a lot of clarity on the situation in Europe. These things are making investors cautious. But the fundamentals are still strong.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" While the last few weeks have been rocky for financial markets, two industry experts feel the CRE space is still well-poised for growth in the remaining months of 2011. <\/p>\n","protected":false},"author":1201,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1004031654","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"acf":[],"yoast_head":"\n