1 / 18

Economic Outlook Presentation to SC Government Finance Officers – October 2008

On October 13, 2008, Dr. Don Schunk, a research economist from the BB&T Center for Economic and Community Development at Coastal Carolina University, presented an economic outlook to the Government Finance Officers Association of South Carolina. The presentation outlined key economic conditions during the financial crisis, including causes, potential bailouts, and projections for U.S. and South Carolina economies. Key issues discussed included housing market corrections, credit market dynamics, and the implications of financial instability on job growth and unemployment.

hunter-weiss
Télécharger la présentation

Economic Outlook Presentation to SC Government Finance Officers – October 2008

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Economic Outlook Presented to the Government Finance Officers Association of South Carolina October 13, 2008 Dr. Don SchunkResearch EconomistBB&T Center for Economic & Community DevelopmentCoastal Carolina University

  2. Overview of Economic Conditions • The current financial crisis: • How did we get here, and where are we? • Thoughts on the ‘Bailout’ • Recent and Projected U.S. Conditions • Recent and Projected S.C. Conditions

  3. U.S. New Home Sales – The Double Correction1970Q1 – 2008Q3

  4. Key Housing Indicators

  5. The Storm Surge: 2000 - 2006 • The push for ever-increasing homeownership rates • Ongoing financial innovation • Record low interest rates • NINJA loans • The spread of mortgage-backed assets and mortgage derivatives

  6. The Surge Recedes: 2006 - ? • Homeowners default • Mortgage-backed assets lose value • Balance sheets weaken • Abrupt shift in the appetite for risk • Mark-to-market accounting without a market • Credit market stops functioning • Stock markets slide

  7. Savers Borrowers The Financial Infrastructure Financial Markets

  8. The TED Spread Sept 17

  9. Where are we now? • Banks are unwilling to lend • Households and businesses are shifting out of deposits • These decisions are causing the money multiplier to move in the wrong direction – we are witnessing deposit contraction rather than deposit creation

  10. The impacts • The credit freeze is preventing individuals and businesses from borrowing to finance productive economic activities • The economy was already precarious – frozen credit markets have made a recession unavoidable

  11. The intentions of the “bailout” • Remove uncertain assets from the banking system – increase the willingness to lend to households and businesses by increasing the willingness of banks to lend to each other • Keep more funds in the form of bank deposits

  12. Recent U.S. Trends2000Q1 – 2009Q4

  13. U.S. Net Exports1970Q1 – 2009Q4

  14. U.S. Real GDP Growth2000Q1 – 2009Q4 2000 3.7% 2001 0.8% 2002 1.6% 2003 2.5% 2004 3.6% 2005 2.9% 2006 2.8% 2007 2.0% 2008 1.4% 2009 0.4% 2010 2.0%

  15. Job Growth: SC and US1991Q1 – 2008Q3

  16. Employment: Total and Selected Sectors2000Q1 – 2008Q3

  17. S.C. Employment Growth2000Q1 – 2009Q4 2000 1.6% 2001 -1.9% 2002 -1.0% 2003 0.2% 2004 1.4% 2005 1.8% 2006 2.2% 2007 2.3% 2008 0.3% 2009 -0.3% 2010 0.8%

  18. Unemployment: S.C. and U.S.1976Q1 – 2009Q4

More Related