At LBM Expo, economist muses on the "recovery"
"There has actually been recovery since 2009, but there's probably nobody in this room who believes that," said economist Bob Berg during a luncheon presentation at the Northeastern Retail Lumber Association's (NRLA) 2012 LBM Expo.
He added to the positive news by suggesting that banks are starting to lend money again, as the nation's financial institutions slowly realize that one of the few ways for them to make money is to lend it the old-fashioned way.
Berg, a founding member of RISI and analyst with more than 30 years experience following the North American solid wood products and timber markets, delivered his presentation "Two-year outlook for the North American Panel and Softwood Lumber Markets" during the NRLA event at Foxwoods in Mashantucket, Conn.
Overall, Berg described slow growth as the most likely path for the economy and volatility as the key word to describe the lumber markets.
The RISI economic adviser expects the excess inventory in housing to be eliminated by 2013, when demand for new shelter could begin a meaningful recovery.
On the downside of the possible factors that could aid or abet the economy: the Eurozone crisis, the possible oil shock and a retreat in consumer spending. Clouding the prospect of the overall economy, he said, was the prospect of European confusion. "We don't know what it means when a government defaults on a loan," he said, referring to the particularly troubled economies of Italy, Ireland and Greece.
Upside factors counterbalancing those include a sooner-than-expected housing recovery, surging export growth boosted by a weak U.S. dollar, and the prospect of falling gas prices providing a stimulus.