Spring Conference Review - reomac

GENERAL SESSION II:
Economist Speaker,
Christopher
Thornberg, PhD.
By Jim
Conway
Dr. Thornberg gave the REOMAC®
Conference attendees his semiannual
update on the state of
the U.S economy with an emphasis on
the troubles being experienced in our
financial markets and the government’s
efforts to both ameliorate the economic
distress and to re-stimulate the real
estate and financial markets. Christopher
Thornberg is an expert in the study of
regional economies, real estate dynamics,
labor markets and business forecasting. In
2006, he co-founded Beacon Economics,
an economic research and consulting firm
that specializes in real estate markets,
local economic development, and public
and private policy issues. Dr. Thornberg
has established a reputation as one of the
State of California’s leading economic
forecasters. Prior to launching Beacon, he
was an economist with UCLA’s Anderson
Forecast where he regularly authored
economic outlooks for California, Los
Angeles and the East Bay.
Dr. Thornberg believes that we are currently
in a recession and not a depression and that
we should be in a recovery by 2011. He
stated the collapse of Lehman brothers
in 2008 was not as big a factor in the
subsequent troubles the U.S economy has
experienced as many think. Dr. Thornberg
believes that the housing plans that are
aimed at keeping people in their homes are
counter-productive in some cases and may
even bury some homeowners who may not
ever be able to build up equity or even be
able to sell their homes due to the size of
the mortgage. The plans, according to Dr.
Thornberg, won’t work because they don’t
deal with homeowners that are seriously
under water. He also stated that it will
have limited impact in turning around
both banks and financial markets.
As a possible curative, he offered what he
called the: “Mulligan Solution.” In Golf, a
Mulligan is a do-over of a bad shot (such as
hitting your tee-shot into a water hazard).
He proposes that the government legislate
that anyone that had their home foreclosed
between 2002 and 2009 be given a clean
slate on their credit report which would
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REOMAC ® update tm Ma y / Jun e 2009 29