1. Recession, Recovery & the Repercussions of Both Springfield, MO September 18 th, 2012

2. U.S. Forecast

3.  A Pall of Uncertainty Hangs Over the Economy  Health Care Reform  Supreme Court ruling – now what?  Dodd-Frank  Fiscal Cliff / Taxaggedon  Euro  November Election

4. U.S. Forecast  A recent paper has created an index that quantifies economic policy uncertainty and analyzes its economic impact:  Measuring Economic Policy Uncertainty By Scott R. Baker Nicholas Bloom, and Steven J. Davis

5. U.S. Forecast  The index has three components: 1.Newspaper coverage of policy- related economic uncertainty. 2.Number of federal tax code provisions set to expire in future years 3.Disagreement among economic forecasters (Survey of Professional Forecasters)

6. U.S. Forecast  The economic impact of economic policy uncertainty The results of the statistical analysis in the paper show that higher policy uncertainty causes: 1.Lower private investment 2.Lower industrial production 3.Much lower employment

7. Economic Policy Uncertainty Index

8. U.S. Forecast  Sky Mall™ Policy:  An Expensive Policy that Fails to Achieve its Desired Outcome

9. U.S. Forecast

15.  Two Sky Mall™ Policies:  Health Care Reform  Community Living Assistance Services and Supports ended before it began  American Reinvestment and Recovery Act of 2009  Aka Stimulus Act

16. Why Didn’t the Stimulus Act Work?

17.  The Nun  The Nobel Prize Winner  Non-starter Stimulus Why Didn’t the Stimulus Act Work?

18. U.S. Forecast  Depleted Wealth  Still Weak Labor Market  A continuing downward force on consumer spending

19. U.S. Household Wealth (Trillions of $) 2005200620072008 2009 Q1* 2012 Q1 Total Assets 71.378.679.566.6 62.8 76.2 Financial Assets 42.949.051.442.2 39.6 52.5 Home Equity 13.212.810.37.0 6.1 6.7 Net Worth 59.165.1 52.4 48.7 62.9

20. U.S. Economic Outlook 2012 Q1 2012 Q2 2012 Q3 2012 Q4 20132014 GDP % Change, Annual Rate 2.01.71.61.72.12.7 Consumer Price Index % Change, Annual Rate 2.50.20.41.31.81.9 Consumer Sentiment 75.475.573.873.975.680.0 Consumption % Change, Annual Rate 2.41.51.92.32.42.6

21. U.S. Forecast

24.  What Can the Fed Do?  Slowing recovery in economy and labor market  June FOMC  Operation Twist Extended  August FOMC  Status quo

25.  Monetary Policy - September:  Fed Funds rate unchanged until second half of 2015  QE III  $40 billion per month – open ended  Mortgage backed securities  Is inflation a worry? U.S. Forecast

28. A Slippery Subject  Greece  Greek bailouts, haircut & the election are stays of execution and not pardons  Contagion concerns (PIIGS)  Euro still facing greatest threat since inception  Two possible outcomes for the Euro zone

29. The Euro and the Tacoma Narrows Bridge A Slippery Subject

30.  Economic Conjoined Twins:  The Housing Market  The Labor Market U.S. Forecast

31.  What’s Springfield to do?  Recite The Economic Serenity Prayer  Things you can change:  Dynamic educated labor force  Invest in transportation infrastructure  Don’t give up on economic development programs U.S. Forecast

32. Sean M. Snaith Sean M. Snaith, Ph.D.Director Institute for Economic Competitiveness (407) 823-1453 Sean@SeanSnaith.comWWW.IEC.UCF.EDUwww.facebook.com/seansnaith Twitter: @seansnaith Thank you