Perryman upbeat on Texas’ economic prospects

Published or Revised December 05, 2008

This year's North East Texas Economic Outlook Conference in Sulphur Springs Wednesday was well attended by about 300 people from around the region. Economic uncertainty no doubt drove the larger crowd, as everyone wanted to hear from featured speaker Dr. Ray Perryman, with The Perryman Group. His forecast includes Hopkins, Hunt, Delta, Lamar, Franklin and Titus counties. Despite the economic downturn, Perryman was upbeat about Texas prospects. He said the Texas economy is strong, though Texas is not insulated from national troubles, as anyone opening a retirement fund statement would know. Despite that, he points to Texas gaining 250,000 jobs during what we know now was an official recession last year. Specific to the region, Perryman said that Northeast Texas has diversified in the past few years and gained new industries, but there are still challenges. Though stable, he said the area housing market "overbuilt" by 10-15 percent. He said that compared very favorably to California that had overbuilt by about 110 percent. Other bits of information Perryman provided included:

• A prediction of a 3.5 to 3.6 percent growth rate in the economic outlook for northeast Texas over the next five years.
• To accurately gauge the economic recovery, Perryman said: "Don't look at the DOW, look at the percentage rate at which banks are lending to each other and compare that to the one-month US Treasury bill rate." In normal economic times, there is an average tenth of a percent difference but right now the two are four to five percentage points apart. Seeing the two rates come closer together signals economic improvement.
• When asked by an audience member if there was a "critical point" in the national debt, Perryman responded: "If there is, we haven't found it. The critical point isn't a particular number, it's reached when the world is unwilling to hold our debt."
• Each dollar spent on the federal highway system during the Eisenhower administration today gives a return of 30 percent in economic benefit to the nation. He is encouraged by the incoming Administration about investments in infrastructure because of that.

Overall prospects for recovery are strong, according to Perryman, and he feels it will come more quickly than anyone believes – he thinks growth will occur by the second quarter of 2009. "When everyone wants to be safe, they buy US Treasury bonds because the United States is still strong economically and politically," said Perryman, citing as an example that it took only 21 days after the 9/11 tragedy for the economic recovery to begin. "The whole world is mad at us because they think we started these economic problems," he added, "and we did — but they still buy our bonds." The conference, held by the Hopkins County Chamber of Commerce and sponsored in part by Paris Junior College, was held at the Hopkins County Civic Center in Sulphur Springs. Attendees from Paris Junior College included PJC President Dr. Pamela Anglin, Vice President of Student Services Dr. Sherry Aaker, Dean of Academic Studies Dwight Chaney; Dean of Business Services John Eastman, Sulphur Springs Center Director Linda Bennett; and Public Information & Marketing Director Margaret Ruff.