NEWSLETTER ARTICLES
August 1, 2010Are We In or Are We Out!
Will the economy double-dip or are we still in a recession. Peter Cohan, president of Peter S. Cohan, a management consulting and venture capital firm, wrote in his latest blog for Daily Finance, that we really haven’t emerged out of the first recession; and, though growth might be occurring it is happening at such a slow pace it doesn’t feel like real growth.
Contrast our country’s anemic growth over the past three years with that of Japan’s lost decade where economic expansion came to a total almost complete halt from 1991 to 2000. During this period, most Japanese households didn’t feel the economic effects on a daily basis but the long-term impact of nearly negative growth shifted Japan from having the world’s second largest economy to a point where today China’s economy has recently surpassed it.
We don’t anticipate such a drastic occurrence for the U.S. economy, but the continued slow growth underscores the difficulty in getting existing and new companies to make decisions on new investment. Currently, the Coalition has 19-active projects totaling more than $2.3 billion in possible new investment and 2,000 new jobs for our region. It would be great to announce three or four new projects tomorrow morning, but the reality is that most companies are in a holding pattern doing their due diligence while waiting for the right economic signs to pull the trigger to spend money.
Those companies with cash or who have access to capital will look for investment opportunities like the recent acquisitions by Windstream of Q-Comm and the sale of American General Finance to Fortress Investment Group. Both purchases could have very positive outcomes for Southwest Indiana but we won’t know the total impact for a few more months. In the meantime, the Coalition’s job is to continue positioning Southwest Indiana as the ‘right place’ for new investment so that when investment decisions start to be made we’ll garner our fair share.
