Economist Addresses Club

The Sanford Lions Club welcomed one of the state’s leading economists as speaker at its regular weekly meeting May 28 at the fairgrounds. Dr. Michael Walden, the William Neal Reynolds Distinguished Professor in Agricultural and Resource Economics at N.C. State University, discussed the economic recession and answered many questions.
Recessions aren’t uncommon as America has experienced 14 since World War II, Dr. Walden said. But the reason this one is the worst is the tremendous negative impact seen in the nation’s financial sector, and it all began, in his view, with the collapse of the real estate market. Inflated housing values in recent years resulting from an easy flow of money from the Federal Reserve and risky mortgage schemes offered by many financial markets, much of which unregulated by the government, collapsed like a house of cards. The result was a free-falling economy that was as near a total collapse not seen since the Great Depression.
Over the past three years housing values have dropped an average of one-third, the longest sustained decline ever, and American consumers have lost 20 percent of their wealth, amounting to trillions of dollars, Walden said. Economists generally feel the recession will bottom out by the end of this year or early 2010 and show improvement next year. The positive news at this point is the economic free-fall appears to be over with markets declining at a slower point.
Dr. Walden said there will be much more scrutiny of the Federal Reserve and banking practices throughout the recovery period and beyond and as the economy improves there will have to be a reversal of much of the emergency government action taken this year so as to reduce the national debt and likelihood of inflation and higher taxes. Thus, a destimulation on the federal government’s part, Walden said, prompting a chorus of “ayes” from the audience.
Woody Seymour was program chairman and introduced the speaker. President John Walden, Jr. presided and Roy Jernigan gave the invocation. George Kostrewa led the Pledge of Allegiance. Club members stood for a period of silence in memory of Dr. Kenan Williams who passed away last week.
Several visitors were recognized including Marty Rowe with Lion Joe Johnson, Mark Carroll with Lion Dowe Smith, Steve Martin was a guest of his father Lion Charles Martin, and Matthew Shaw attended with his grandfather, Lion John Cole.