Serving Bel Air, Benedict Canyon, Beverly Hills. Brentwood, Laurel Canyon, Los Feliz, Malibu, Pacific Palisades, Melrose, Santa Monica, Sherman Oaks, Studio City, Topanga, Canyon, Westwood & Hollywood Hills.

Name

E-mail

facebook Canyon News twitter Canyon News

Canyon News

Bel Air News

Beverly Hills News

Brentwood News

Hollywood Hills News

Laurel Canyon News

Los Angeles News

Los Feliz News

Malibu News

Melrose News

Pacific Palisades News

Santa Monica News

Sherman Oaks News

Studio City News

Topanga Canyon News

West Hollywood News

Westwood News

Woodland Hills

Celebrity News

State News

National News

World Headlines

Deaf News

Entertainment

Film

Television

Music

On the Industry

Star Gazing

St. John's Confidential File

Theatrical Musings

Life & Style

Event Listings

Tech Talk

Looking Good For Lots Less

Spirit & Creativity

Miller Time

Books

View from the Hill

NY WEST

Chrystal's Recipe Corner

Career and Life Coaching

Gardening With Tony

Life According To Lenson

Real Estate Realities

Food

Sports

Marathon Running

Keeping It Bruin: A Look Into UCLA Athletics

Baseball

Basketball

Football

Hockey

Pets

Vi's Corner

Pet Tips

Point of View

John Armor

Message to America

Critic At Large... Ruta Lee

Labor Week

Ramblings

10 Degrees Cooler

McConnors corner

Edge of the west

The Physics Wizard

Auto

Kyle's Kars

Travel

Susan Michelle's Compass

Advice

Ask Deanna

Dear Lily

Ask Oona

Features

Dancing with Earthquakes

Archives

Sports Schedules

Traveling Beyond the Canyon

Edge of the West

Law Man

Ask Us

Nathan Tabor

The Angry Economist

Truth Probe

As I See It

Columnists

Truth Conquers

The Live Wire

Notes from Exile

Letters to the Editor

Dog Training by Anthony

Canyon Mews

Speak!

Sponsors

America's Most Wanted Dogs

World Recipes

Vegetarian Lifestyle

Humor

News Briefs

Local News

Books

News

Canyon Fodder

Bad Movie Night

Critical Projection

Ed's on the Town

Fitness Quests

Flashback Films

Stories of the Strange

Gourmet Grandma

He Said/She Said

Home Matters with Yvonne

L.A. Etch-a-Sketch

L.A. Ruminations

McConnor's Corner

Mommy Minute

Musically Speaking

My Back Pages

Publisher's Pages

ResourceINK

Scene and Heard in L.A.

Silly...But Wise!

Sunset Diaries

Table Options

The Paws Cause

TV Stuff

Cartoon of the Week



The Angry Economist

Battling Economists: The UCSB Economic Outlook as Declaration of War Against UCLA
Posted by William P. McGowan, Ph.D. on Mar 5, 2006 - 7:18:00 PM

CALIFORNIA—  One of the more interesting aspects of this years UCSB Economic Forecast was the studies declaration of war against a rival study issued by their academic brethren down the road at UCLA.  For those who missed it, in 2006 the UCSB Economic Forecast is treading on UCLAs territory by issuing an economic forecast that includes the greater Los Angeles Basin. This was not an overt attack, for the Los Angeles section was only contained on the reports compact disk, and not on its printed pages.

 

For the last five years, UCSBs Economic Forecast Unit has been remarkably accurate.   More importantly for those of us living in Southern California, for most of this time they have refused to join with UCLAs predictions of a housing bubble.

 

While the storied (and supposedly more accurate) UCLA Economic Forecast has been predicting a housing collapse since 2003, the two guys at UCSB kept reminding us that our economy is no longer driven by local events. California in general and Southern California in particular are magnets for the nations wealthy in their retirement years, and there are more of them coming.

 

And for most of the last five years, UCSB has been right on the money. Which is probably why the UCSB Economic Forecast Project is moving in on UCLAs territory. 

 

Despite UCSBs reputation for rosy (and accurate) forecasts, this year theyre telling us that our economy is not impervious to trouble. Indeed, we may be due for some soon.  Interestingly, now that the folks in Brentwood think things are getting better, the economists in Goleta are getting nervous.  After predicting the end of the world (literally) in their previous forecasts, UCLAs Economic Forecast sees a soft landing for the housing market, and thus a positive for the economy. In other words, theyve finally seen the wisdom in UCSBs work.

 

Where UCSB differs is that for the first time, they are using the R” word, Recession.  Not now, and not next month, but there are growing concerns among many economic minds that Greenspans final legacy will be an interest-rate led recession that hits the country sometime in late 2007.  Heres why”¦

 

Driving the economy at the Federal Reserve is a lot like driving an aircraft carrier in a small bay at slow speed.  Moving the throttle or rudder right now by increasing interest rates does nothing to affect the immediate course of the economy; it is in nine to sixteen months that they are felt. 

 

Thus, the interest rate tightening that has been the subject of much discussion for most of the last year will affect us next year.  Though he leaves the fed being called maestro, Alan Greenspan hasnt been perfect, and he made some real enemies for tightening too fast and too much after the dot.com bust of the 1990s.

 

 Thats what Bill Watkins at the UCSB Economic Forecast fear is happening now. With Bernanke living in Greenspans shadow, Watkins is concerned that the new Chairman of the Federal Reserve will be unable to stop the interest rate increases begun under his predecessor until they push us into a recession  Watkins points to the inverted yield curve as proof that this is already happening.  When short-term interest rates are higher than long-term rates, it is not a sign of market imbalance: its a sign that the Fed has tightened too quickly.

 

I call this to your attention because, as I mentioned near the top, UCSB is predicting this, and UCLA isnt. Given their respective track records, thats reason enough to sit up and take notice.

 

Disclaimer: William P. McGowan received his doctorate in Economic History from UCSB. 

           

 



 

Cliffside Malibu

-------------------------

-------------------------

 

Serving Bel Air, Benedict Canyon, Beverly Hills. Brentwood, Laurel Canyon, Los Feliz, Malibu, Pacific Palisades, Melrose, Santa Monica, Sherman Oaks, Studio City, Topanga, Canyon, Westwood & Hollywood Hills.