Independent Research Firms weigh in on what’s to come in 2009-


Yesterday President Elect Barack Obama delivered a speech emphasizing the need for fast action in passing an economic recovery plan. Obama forewarned that reluctance to do so could result in a recession that may linger for years.  His proposed $775 billion stimulus package includes $300 billion in tax cuts with tax credits of up to $500 to individuals, $1,000 to married couples, and a $3,000 tax credit to business for each new employee that they hire. Just as there is a wide range of opinions from Washington, many of the +2000 independent research firms tracked by Integrity have much to say on the proposed plan and what to expect for the new year.

The proposed tax cuts has raised a number of discussions. Some members are saying, “Why do we have to do this? We’re subsidizing bad companies with good companies’ tax dollars,” says Daniel Clifton, head of D.C. policy research for Strategas Research Partners, an investment strategy, macro-economic and policy research firm. Financial economist Brian Bethune from IHS Global Insight, an economic research and advisory services firm, believes that the plan may be a good idea. Bethune affirms that tax cuts are needed to provide an initial jolt because new infrastructure projects take time to get up and running.  “In the broad sense, they’re moving in the right direction, looking at what would be effective and also expedient,” Bethune says.

Another major issue at the forefront of discussion for a number of research firms is the current housing crisis. John Burns Real Estate Consulting, a real estate consulting firm, cites that for the first time since the 1930s, US. National home prices are falling. The firm recently released a white paper on the housing market- Unlocking The Housing market Recover- A Housing Experts where they listed what they believe needs to be done to solve the housing crisis.Real Capital Analytics, a market research firm that tracks commercial property transaction, announced that roughly $107 billion worth of hotels, office buildings and shopping centers are in trouble, ranging from mortgage delinquency to foreclosure. Dan Fasulo, Managing Director at Real Capital projects that 2009 is not going to be a good year. “We’re at the point where a normal, functioning market doesn’t exist. Buyers are there, but they don’t necessarily want to make an acquisition. Pile on top of everything that we don’t have a functioning debt market. It creates paralysis in the market.” IHS Global Insight concurs. According to Pat Newport, a real estate analyst for the firm, home sellers should not expect prices to improve any time soon, “I expect it’s going to get quite a bit worse over the next couple of months.” he say.

“Dealing with this foreclosure crisis is something that we’ve got to do,” Obama said in an interview with CNBC.”I expect to unveil plans to prevent foreclosures in consultation …in the next month or two.” Obama will take office in 11 days. While it is clear that we are not out of the woods, just about everyone is on the edge of their seats both anxious and hopeful for successful plans of action by the government and better news for 2009.


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