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I'm Bullish on the Economy!

Everywhere we turn, there’s more “bad news” about the economy. Just try a Google search on the word economy. If that doesn’t send you into a financial panic, I’m not sure what would.

But is all of this “news” truly the reality? I’m not convinced.

There’s no doubt we have suffered one of the greatest economic downturns since the Great Depression. But the constant reporting of any and all negative economic news seems to be driving our economic attitude. When I read an article, watch the news or listen to the radio, it seems to me that most of the focus is on two things: making us afraid of our economy and telling us who the so-called experts and politicians think we should blame for it.

No one seems to focus on the positive aspects of our economic recovery. Most see the recovery glass as half empty; I see our economic glass as half full—and still filling up.

Even during the darkest days of this economic crisis, I remained optimistic that we were on the road to recovery—and we are! Many of my colleagues have challenged my optimism—especially on the subject of a double-dip recession. But I remain bullish on our economy and see no signs of a double dip.

But make no mistake about, recovery doesn’t mean all is well.

So, this is how I see it. Normal, as we knew normal before the recession, is gone forever. Governments will continue to cut people and programs, and that won’t stop for many of us for another year or more. We will have to continue to find new and innovative ways to provide services and protect the quality of life in our communities and for our personnel.

But not all is lost. Some of the changes we’ve made so far are simply brilliant, and they should have been done even without a bad economy. Many of the base signs of economic growth and recovery are rising despite the morbid speculation and negative reports:

  • U.S. factories grew in November at the fastest pace since June.
  • The Institute for Supply Management reported that the manufacturing index rose from 50.8 in October to 52.7 in November. Any reading above 50 indicates an expanding economy.
  • U.S. builders spent more in October, which boosted construction spending for the third straight month.
  • Nationwide, applications for new building permits rose by 11% in October, the highest level in three years.
  • Unemployment fell below 9% in November and is the lowest unemployment rate in two and a half years.
  • Housing, the anchor of the recession, is showing signs of recovery with the top 10 recovering markets now in Florida, Arizona, Indiana, Idaho and Michigan.
  • A new nationwide survey issued in December by Citibank finds consumer optimism about the economic future has rebounded seven points since August, with nearly half of American consumers (48%) expecting local business conditions to improve over the next 12 months.
  • The National Retail Federation revised its holiday forecast in December, increasing the expected holiday sales from an estimated 2.8% growth to 3.8% growth over the 2010 holiday season.
  • Although the stock market has been very volatile in 2011, in December 2011 the Dow was up approximately 5% for the year, the S&P was on both sides of unchanged but was up just under 0.1% for the year and the NASDAQ was down 0.1% for the year.

There’s no doubt that these indicators can change and that the situation in Europe will weigh heavily on the depth and speed of our continued recovery. The European Central Bank warned recently of a perilous year ahead. Much like our Congress, in-fighting among European Union countries continues and a quick resolution seems to be in doubt.

Negativity breeds doubt. Disagreement and political gamesmanship will continue in our country, especially during the upcoming presidential election process.

All said, I remain optimistic that in 2012, our Congress, the European Union and the Central Banks will see that “Now is the time for all good men to come to the aid of their country.”

As fire chiefs, our charge is no different.

J. Robert Brown, CFO, is chair of the IAFC Economic Crisis Task Force and fire chief of the Stafford County (Va.) Fire and Rescue Department.

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