1. National, State and Local Economic Outlook January 6th, 2009

2. The Business Cycle

3. REFERENCE DATESDURATION IN MONTHS PeakTroughContractionExpansion Quarterly dates are in parenthesesPeak to Trough Previous trough to this peak December 1969(IV) November 1970 (IV)11106 November 1973(IV) March 1975 (I)1636 January 1980(I)July 1980 (III)658 July 1981(III)November 1982 (IV)1612 July 1990(III)March 1991(I)892 March 2001(I)November 2001 (IV)8120 December 2007(IV) ?? 73 Recent Business Cycle Data

4. REFERENCE DATESDURATION IN MONTHS Average, all cycles: ContractionExpansion Peak to Trough Previous Trough to Peak 1854-2001 (32 cycles)1738 1854-1919 (16 cycles)22 27 1919-1945 (6 cycles)18 35 1945-2001 (10 cycles)10 57 Historical Business Cycle Data

5. U.S. Forecast  U.S. Currently in a Moderate Recession (not depression)  12 months and counting…  Recession: 2007Q4 to 2009Q2/Q3  Housing, credit freeze, turmoil in financial markets and volatile energy prices have created an environment that is toxic for economic growth.

6. U.S. Forecast  Short-run threat of inflation subsided:  Energy prices – bubble has burst  Inflation gone, but not forgotten  Extremely stimulative fiscal and monetary policies  Once recovery takes root prices could rapidly rise

7. U.S. Forecast  Fed has cut target interest rate to near zero  Quantitative easing  Another stimulus package - $500 billion, $750 billion or even $1 trillion?  Stimulus should be a cocktail of drugs to fight the recession  Rebate Checks  Infrastructure  Investment incentive  Treasuries the latest bubble?

8. U.S. Economic Outlook From IEC 4 th Quarter 2008 Forecast 2008 Q2 2008 Q3 2008 Q4 2009 Q1 2009 Q2 2009 Q3 Gross Domestic Product % Chg, Annual Rate 2.8-0.5-3.5-2.0-0.40.5 Consumer Price Index % Chg, Annual Rate 4.96.6-8.1-2.4-1.51.3 Oil - WTI ($ per barrel) 123.8118.159.853.847.348.2 Total Consumption % Chg, Annual Rate 1.2-3.2-3.70.72.03.5

17. A look at the Florida housing data: November 2008 Snapshot

18. Realtor SalesMedian Sales Price Region or MSA November 2008 November 2007 %Chg November 2008 November 2007 %Chg STATEWIDE 8,5718,2694$158,300$217,000-27 Orlando 1,2771,108 15$167,900$239,000-30 Panama City 4847 2$190,000$192,500 Fort Walton Beach 127155-18$191,300$199,300-4 Jacksonville 545619-12$150,000$178,200-16 Tallahassee 100137-27$170,000$201,400-16 Lakeland-Winter Haven 211235-10$127,400$158,900-20 Florida Sales Report – November 2008 Single-Family, Existing Homes

19. Florida Sales Report – November 2008 Single-Family, Existing Homes Realtor SalesMedian Sales Price Region or MSA November 2008 November 2007 %Chg November 2008 November 2007 %Chg STATEWIDE 8,5718,2694$158,300$217,000-27 Orlando 1,2771,108 15$167,900$239,000-30 Fort Myers-Cape Coral 600365 64$106,100 $228,100-53 Marco Island 2514 79 $262,500$500,000-48 Punta Gorda 174154 13$97,700$177,300-45 Miami 366263 39$224,700$359,300-37 Fort Pierce-Port St. Lucie 318230 38$130,500$206,300-37

20. Realtor SalesMedian Sales Price Region or MSA November 2008 November 2007 %Chg November 2008 November 2007 %Chg STATEWIDE 2,2782,474 -8$130,600$185,600-30 Orlando 135125 8$76,100$140,600-46 Pensacola 2126-19$375,000$225,00067 Panama City 1721 -19$258,300$260,700 Jacksonville 6078-23$131,400$135,800-3 Gainesville 1436-61$133,300$146,700-9 Ocala 3250 $95,000$108,000-12 Florida Sales Report – November 2008 Existing Condominiums

21. Realtor SalesMedian Sales Price Region or MSA November 2008 November 2007 %Chg November 2008 November 2007 %Chg STATEWIDE 2,2782,474 -8$130,600$185,600-30 Orlando 135125 8$76,100$140,600-46 Miami 308297 4$172,600$264,700-35 Fort Pierce-Port St. Lucie 4944 11$110,000$170,000-35 Melbourne-Titusville- Palm Bay 67 —$113,800$172,500-34 Fort Lauderdale 442430 3$109,400$166,700-34 Florida Sales Report – November 2008 Existing Condominiums

22. A look at the housing data: January 1994 to November 2008

33. Florida Forecast Scenario for Florida Economy:  Credit freeze further delayed real estate recovery  Recovery will finally start to take root in 2010  Economy s-l-o-w-l-y gains momentum  Short and Long run demographics of the state have changed

42. Region Population Growth Average % ChgRank Florida 0.9--- Deltona 0.96 Gainesville 1.05 Jacksonville 1.34 Lakeland 1.92 Miami 0.19 Naples 1.34 Ocala 2.21 Orlando 1.63 Palm Bay 0.77 Pensacola 0.48 Tallahassee 0.96 Tampa 0.96 2009-2011 Averages; Q4 2008 Forecast

43. Region Employment Growth Average % ChgRank Florida -0.4--- Deltona -0.42 Gainesville -0.64 Jacksonville -0.96 Lakeland -0.96 Miami -0.96 Naples -0.42 Ocala -0.53 Orlando 0.21 Palm Bay -0.85 Pensacola -0.85 Tallahassee 10 Tampa -0.64 2009-2011 Averages; Q4 2008 Forecast

44. Sector Orlando % Avg. Ann. Gr. Educ.-Health Serv. 3.7 Other Serv. 2.3 Prof. & Bus. Serv. 0.7 Trade, Trans., Util. 0.3 State & Local 0.3 Leisure 0.2 Federal 0.2 Financial 0.0 Information -1.3 Manufacturing -4.5 Const. & Min. -6.1 2009-2011 Averages; Q4 2008 Forecast

45. Sean M. Snaith Sean M. Snaith, Ph.D.Director Institute for Economic Competitiveness (407) 823-1453 ssnaith@bus.ucf.eduWWW.IEC.UCF.EDU Thank you