BUSINESS BEAT: Take the long-term view, says economist

Bob Quick | The New Mexican

1/12/2009 - 1/13/09

At the 2009 Economic Outlook Conference last Wednesday in Albuquerque, Stewart Massey, co-founder of New Jersey-based Massey Quick Wealth Advisors, took time to talk about "a disastrous 2008" and what he sees coming in 2009 and in future years.

Massey was one of several speakers at the conference, which included economist Eugenio Aleman of Wells Fargo and Larry Waldman, an economist with The University of New Mexico's Bureau of Business and Economic Research.

"The over-leveraging of the economy is what we're experiencing right now," Massey said. "Lending became credit insensitive, not just in the U.S. but everywhere."

That led to a crisis of confidence, a drop in the value of securities, illiquidity and the lack of trust on the part of lenders, Massey said. "Fear ruled the day."

Unemployment is rising, small businesses are "dying on the vine," with more problems on the way, Massey said.

Massey wasn't all doom and gloom, however, saying it was unlikely the U.S. would suffer from the 10-year deflationary spiral that hit Japan.

Decisive U.S. monetary policy, which appears to be taking shape, will slow if not reverse the current disaster, said Massey, who is pinning his hopes on government support for financial institutions, no tax increases, home-buyer incentives, lower mortgage rates and government support for financial institutions.

As for investments, Massey likes TIPS (Treasury Inflation-Protected Securities), commodities and, looking ahead from three to five years, and common stocks.

"Fortunes will be made" by investing in today's beaten-down shares, he said. "We need to take a long-term view."


Santa Fe's unemployment rate in November was 3.6 percent, a full percentage point more than the same month in 2007.

"The Santa Fe area lost a total of 500 jobs in November 2008 as the net result of declines in five private industries partially offset by gains in government employment," according to the Department of Workforce Solutions Labor Market Review.

Most of the losses — 300 — were temporary film-industry jobs, which had been added only two months before.

Three hundred jobs were also lost as a result of decreased employment in the city's hotels and restaurants.

There were other losses in professional and business services, construction and miscellaneous other services.

Both government and retail trade saw an increase in jobs.

"Overall the Santa Fe job market has stagnated in recent months, with only five of the area's 12 industries adding jobs," the review said.

If the private sector lost jobs in many industries, the government sector reported the same employment level as 2007, the review said. There were no changes at the federal, state or local level.

Bob Quick covers the business beat for The New Mexican. Call 986-3011 or e-mail bobquick@sfnewmexican.com.