In the new reality of business, it’s more important than ever that your banker be more than “just your banker.” That’s why, at Alerus Financial, we bring you news you can use. This overview on economic indicators contains insightful information for business owners of all sizes.
Download the PDF: June Economic Insights
Overall assessment: Questions about policy dominated the economic and business landscape over the last several weeks. On the monetary policy front, concerns included worries about the eventual effects of the end of the Fed’s QE2 plan as well as the possibility of QE3. The only definitive aspect of Fed policy at this point is that they injected massive amounts of liquidity into the financial system hoping it would resolve a credit risk crisis. On the fiscal side, the budget captured the minds of politicians over the preceding months, particularly related to the debate over raising the debt ceiling. While all sides suggest the problem is being addressed in the most serious of manners, we have seen little substantive progress on a resolution. The uncertainty generated by this issue created some negative sentiment in the economy over the last few weeks, evidenced by the mixed picture provided by the U.S. economic data.
Overall, the data are a stark reminder that we have yet to see the beginnings of a full recovery. Recent weeks saw three factors dominate most financial and business news: 1) the debate over the debt ceiling [already mentioned], 2) fuel prices, and 3) home prices. The underlying connections between the various factors weighing down the economy make it possible to pick almost any piece of data and regard it as the key factor explaining continued weakness, though clearly there are connections between several of these issues.
Data and the related opinions have been compiled by Alerus Financial’s strategic information partner, Dr. David T. Flynn.
Dr. David T. Flynn is an Associate Professor of Economics and Director of the Bureau of Business & Economic Research at the College of Business & Public Administration, University of North Dakota. Dr. Flynn has developed forecast models for personal income and employment in North Dakota, and analyzed small business location patterns for the top 200 cities in North Dakota. His commentary on the North Dakota economy has appeared in print and online publications such as BusinessWeek, NewsWeek, American Banker, the Financial Times, the Wall Street Journal, and in newspaper and magazines from the United States, Brazil and Finland. Dr. Flynn is a member of the International Institute of Forecasters, the National Association for Business Economics, and many other professional organizations.