Search
 

We're Slowing, but Not Falling Into a Recession

SAN FRANCISCO—While several factors have economists and investors concerned, Colliers' chief economist Andrew Nelson puts the facts into perspective for GlobeSt.com and says the outlook is actually quite encouraging.

By Carrie Rossenfeld | Updated on February 05, 2016
Nelson: “Consumers are happy right now, and when consumers are happy, the economy is happy.” Nelson: “Consumers are happy right now, and when consumers are happy, the economy is happy.”

SAN FRANCISCO—While several macro factors including volatility in the stock market, low oil prices and the stumbling Chinese economy have some economists and investors concerned that the US may be heading into another recession, Colliers International‘s chief economist Andrew Nelson puts the facts into perspective and says the outlook is actually quite encouraging – even if the risks are rising. (Colliers International is a GlobeSt.com Thought Leader.) In his recent blog, Nelson provides a detailed analysis why each factor doesn’t necessarily spell gloom and doom for the economy. Here, he breaks it down for GlobeSt.com exclusively and discusses the economy’s impact on the commercial real estate sector.

There are at least three indicators that have people spooked about the economy, Nelson tells GlobeSt.com. “First is the downward trend on Wall Street. The stock market’s recent fall of about 10% could be a leading indication that we are falling into recession, but there’s a famous joke attributed to the economist Paul Samuelson that the stock market has predicted nine of the last five recessions—meaning there are a lot of false positives. Just because the stock market declines, it doesn’t mean the economy will follow, too.”

Nelson is cautious about what the stock market’s recent volatility indicates about real estate for this year. “I don’t forecast the stock market, and I don’t trust people who do. But I will say any potential impacts on the broader economy depend on how long and how much. The stock market goes through these cycles of volatility periodically and then calms down. It had one period like this at the end of the summer that lasted a few weeks, and then over the next few months the market gained back everything it had lost. Now we’re in another correction and volatility remains elevated. But so far it has not reached a scary level or duration.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.