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VOL. 123 | NO. 228 | Thursday, November 20, 2008

Daily News Companies to Present Economic Crisis Forum

By Eric Smith

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The Economic Crisis

Dec. 2, noon to 2 p.m.
FedEx Institute of Technology,
University of Memphis.

Cost is $20 and includes parking and lunch. Reservations are required and can be made by e-mailing rsvp@memphisdailynews.com or by calling 683-NEWS (6397).

Mortgage meltdown. Credit crunch. Financial fallout.

The recent economic woes are often described with alliterative, pithy phrases like those, but the current crisis demands a deeper explanation for the private and public sectors to fully understand how to navigate a marketplace that now resembles a quagmire.

With that in mind, the affiliated companies of The Daily News, The Memphis News and Chandler Reports will present a forum exploring the economic climate as it relates to Memphis real estate and the local economy.

“The Economic Crisis” will be held Tuesday, Dec. 2, from noon to 2 p.m. at the FedEx Institute of Technology on the University of Memphis campus, 365 Innovation Drive.

Daily News executives and distinguished panelists will discuss the condition of Memphis real estate, the mortgage crisis nationwide and symptoms found in the local and national economies.

Educated opinions

The forum begins with a noon lunch, followed by the program at 12:45 p.m. Peter Schutt, CEO of The Daily News Publishing Co., parent of the cosponsoring businesses, will provide the introduction and overview.

Eric Barnes, publisher of The Daily News Publishing Co., then will provide an overview of the real estate and foreclosure crisis in Memphis and Shelby County. His presentation will focus heavily on how the housing crisis spiraled downward so quickly, including a closer look at trends in local data such as foreclosures, sales, construction and lending.

“Given the amount of real estate and banking information that The Daily News and Chandler Reports track, a number of different groups have asked us to speak at various events over the last year,” Barnes said. “We realized there was a lot of interest in our data and analysis.”

Barnes then will introduce the forum panelists, who bring a wealth of knowledge in their respective professions. They are Dr. John Gnuschke, director of the Sparks Bureau of Business and Economic Research at the University of Memphis; David Waddell, president, CEO and senior investment strategist for Waddell & Associates Inc.; Steven Baker, economist at FedEx; and Cleo Stevenson, former chief appraiser for First Tennessee Bank.

“We have carefully grouped together a qualified and diverse panel of experts who will be able to pull together causes and potential outcomes of the local and national crisis, along with possible earmarks of its turning points,” Barnes said.

Points to ponder

Barnes said the forum, which will conclude with a question-and-answer session, was designed for anyone in real estate, development and banking, “but because real estate and banking are so central to the economy, most any business person should find something of interest in the presentation and discussion.”

The panelists will address topics ranging from escalating foreclosures to declining property values, from bailouts to layoffs, and everything in between. As Gnuschke pointed out this week, moving forward in this economic mess won’t be quick or easy because of how far it has spread.

“The interdependency of what happens in the U.S. and other parts of the world – not only Europe but Asia and India and even Latin America – is kind of a new thing,” Gnuschke said. “It has changed since the last major recession. So it’s not just a simple financial issue, and it’s not just housing. It’s an economic crisis, and it’s worldwide in proportion.”

Gnuschke said the fallout from the subprime lending craze is starting to wane, but more and more foreclosures are resulting from a slumping economy. Simply put, people with no jobs and no income don’t have the means to stay in their homes.

“It’s like a chicken and egg problem – we don’t know what to solve first,” Gnuschke said. “Solving the subprime issue is not going to be the end of the recession. If you could do it tomorrow, which you obviously can’t, it wouldn’t be the end of the recession because it’s not going to create jobs.”

Citing rising unemployment rates and little or no job growth as “major barriers,” Gnuschke added that slowing economic activity is going to wreak havoc on the residential, commercial and government sectors for a while.

That makes this forum a mere starting point for what needs to be a larger conversation related to the economic crisis.

“There is no lack of issues that could be discussed as part of this overall presentation,” Gnuschke said.

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PROPERTY SALES 209 209 16,401
MORTGAGES 252 252 18,937
BUILDING PERMITS 393 393 33,519
BANKRUPTCIES 124 124 10,861

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