Ernie Goss Quotes (34 Quotes)


    After growing at a very strong pace in 2005, we are now detecting a slowdown in the pace of growth. Just as nondurable goods manufacturers reported improving economic conditions, durable goods producers detailed a pullback in economic conditions for the month. I expect this slower pace of growth to continue into 2006.

    Job growth in Missouri has definitely slowed over the past several months. In terms of hiring, Missouri experienced January job losses. However, strong new orders should convert to an improving employment picture in the months ahead. Durable goods producers were much more bullish in their economic assessments for January than non-durable goods manufacturers.

    Businesses located in the Northwest portion of Arkansas tended to report stronger economic conditions than businesses in other parts of the state. However, I do expect reasonably solid job growth for most areas through the second quarter of this year.

    As in much of the region, weather played an important role in pushing the state's index higher. Businesses in South Dakota reported undertaking and completing construction projects for the month that would ordinarily have been sidelined until spring.

    As we have seen in the past few months, our inflation gauge, and most national inflation indicators, point to somewhat lower inflationary pressures ahead.


    It is certainly clear that record warm weather for much of the region for January and February played an important role in supporting the economy.

    The trend in economic reports from supply managers in our survey has been fairly positive since October of last year following some of the negative shipping impacts from Hurricane Katrina. Companies with strong ties to the state's growing ethanol industry reported solid growth for February but were very optimistic about future economic growth for this sector.

    Manufacturing job losses in the second half of 2005 pushed Arkansas' overall job growth for the fourth quarter to zero. However, Arkansas firms ... benefiting from the opening of the Japanese and other Asian beef markets, and J.B. Hunt Transport, profiting from the U.S. economic expansion, will drive Arkansas job growth higher in the first half of 2006.

    Survey results, while somewhat weaker than the rest of the nation, continue to point to growth for Missouri in the months ahead. Of course challenges and opportunities related to automobile industry restructuring will be an important driver in the near and intermediate term.

    Strong growth among firms in business and professional services and truck transport offset somewhat weaker reports from manufacturers for March.

    For 2006, Minnesota's big economic stories will be problems related to the continuing cutbacks in the U.S. auto industry, a turnaround for the telecommunications industry, and finally a weakening of Minnesota's construction industry. Nonetheless, our survey points to still solid growth for the first half of 2006.

    While our inflation gauge and most national inflation indicators point to somewhat lower inflationary pressures ahead, I expect the Federal Reserve Open Market Committee to raise interest rates at its next meeting on Jan. 31. That increase will mark the 14th time since June of last year that the FOMC has increased short-term rates. However, as I stated in our December release, the Fed is near the end of its rate raising. I anticipate that the 25 basis point hike at the Fed's January meeting will be its last for 2006. Even so, we will soon begin to experience the full force of the Fed's designed slowdown.

    Of course the loss of the 2,400 GM jobs will hurt the Oklahoma and Oklahoma City economies. However, given the provisions of job banks, the full force of the negative impacts will not be felt until 2008. In the interim, our survey points to solid growth with positive job gains in the months ahead for Oklahoma's economy.

    For most states in the region, unemployment rates moved lower and job growth higher as manufacturers, finance firms and energy providers details growth. However, telecommunications remained weak and construction cooled in January.

    It's clear the overall economy is solid and pointing to growth in the upcoming months, much stronger than anticipated earlier because of energy prices and natural gas prices. We would have expected much slower growth.

    Higher interest rates are cutting a bit into confidence, and now oil prices are going back up to post-Katrina levels.

    No other state in the nation stands to derive as much of an economic stimulus from the opening of the Asian beef market as Nebraska. However, economic gains are going to be slow going as food-processing firms attempt to re-establish a beef presence in these foreign markets.

    The most recent rate increases, and a rate hike at its next meeting, in my judgment will slow growth to an unacceptably low rate for the region and the nation.

    Transportation firms reported continuing economic weakness. While 2006 is likely to be a positive year for the Oklahoma economy due to an improving telecommunications sector and expansions in business service firms, the closing of GM operations in Oklahoma City will produce some fairly negative economic consequences.

    Iowa's leisure and hospitality industry and manufacturing, both durable and nondurable, ended 2005 on a very strong economic note. On the other hand, Iowa's transportation sector and construction industry are beginning 2006 on a lackluster path.

    It's going to be stronger in the first quarter and in the end of the second quarter. It's going to weaken as higher interest rates set in.

    I expect higher commodity prices and escalating short-term interest rates to push regional growth down significantly in the second half of 2006.

    The rate at which our Asian trading partners open their borders to U.S. beef will be an important factor affecting growth for the state in 2006.

    Despite difficulties for Missouri's vehicle manufacturing sector, durable goods manufacturers overall continue to report expanding economic conditions. I expect the state's telecommunications industry to experience much improved growth for 2006. On the other hand, due to increasing and stiff competition from casinos in other states, I anticipate a subdued 2006 for Missouri's casinos.

    The Mountain States region experienced growth significantly higher than the rest of the nation. The region added 53,000 jobs, an annual growth rate of 2.9 percent, in the first half of 2005 but added only 41,000 jobs, an annual growth rate of 2.2 percent, in the second half of the year.

    If we'd had a typical winter, it would have been a little tough for the retailers.

    For example, greater reliance on ethanol by the U.S. will make many areas in the region clear economic winners.

    However, the real danger is that the warm weather may have fooled many into thinking the economy is doing better than it is.

    The 15 Fed rate hikes and higher energy prices, even with the warmer than expected winter weather, are having negative impacts on confidence among regional supply managers and business leaders.

    Businesses in North Dakota definitely benefited from much warmer weather for the month according to comments from businesses in our survey. It is difficult to separate out the impacts of weather from more fundamental economic factors, but even so, our survey still points to solid growth in the months ahead.

    Increases over the past two months point to solid growth into the second quarter of this year.

    There's every reason to have some concern there.

    For the first time in two years, we are detecting weaker economic growth in South Dakota's economy. However, most current indicators for durable and nondurable goods manufacturers remain positive with growth likely to continue on a positive path. The growth for 2006 will be lower than that for 2005.

    I expect positive, but weaker hiring in the region in the months ahead.


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