Economist says recession will end in September
BISMARCK - The recession will end Sept. 15, 2009, a noted economist said Wednesday at an economic development conference.
Mark Zandi, the chief economist for Moody's Economy.com -- the same company that advises ND state government - told the audience at the 20th annual Marketplace for Entrepreneurs that though next September will eventually prove to be the "technical bottom," that probably won't be known for two or three years later.
And, he said, it will be 2011 before the economy has recovered to the point that the country is "comfortable."
"They don't call economics the dismal science for nothing," Zandi quipped when he took questions from reporters after the speech.
He said the reason sub-prime mortgage lending and the related speculative investments in those loans triggered the current recession was "everyone thought the other guys were doing the appropriate diligence" as far as developing and selling the investments.
"It was a system that was fundamentally flawed," he said.
Zandi said oil prices will likely remain under or around $40 this year and about $75 over the next three to five years.
Sen. Kent Conrad, who has hosted Marketplace for 20 years, also said Wednesday that he has a package of ideas for inclusion in President-elect Barack Obama's economic stimulus plan for rural revitalization.
They include funding for upgrading and expanding electric transmission lines, loan guarantees for constructing ethanol pipelines because ethanol is to corrosive to go into regular pipelines, funding for ready-to-go highway and bridge projects, $200 million for the Bureau of Reclamations rural water program, programs to upgrade rural health facilities' "crumbling buildings," and increase funds for recruiting rural physicians and payments to rural ambulance services.