12:26 p.m., Feb. 11, 2011----The 2011 Economic Forecast conference brought together almost 250 Delaware business owners, educators and economic enthusiasts to Clayton Hall on the University of Delaware's Laird Campus in Newark Tuesday morning.

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The annual event, sponsored by Lyons Companies, the University of Delaware Center for Economic Education and Entrepreneurship and Chubb Group of Insurance Companies, featured presentations and a panel discussion by a distinguished group of financial analysts including former U.S. Sen. Don Nickles, president of the Federal Reserve Bank of Richmond Jeffrey Lacker and CNBC contributor and financial consultant Michael Farr.

David Lyons of the Lyons Companies, Gov. Jack Markell and UD President Patrick Harker greeted attendees.

“There's a big picture forming around innovation and entrepreneurship, and the role of universities in supporting and rewarding risk-taking and risk-takers,” said Harker. “I consider this our mission: to actively build our creative capital, to gather together our intellectual assets and deploy them to build a vibrant, sustainable economy fueled by discovery, invention and innovation.”

As part of this mission, Harker spoke about a number of regional partnerships that are expanding the University's reach and economic-development potential, including those with the U.S. Army at Aberdeen Proving Ground, the Gamesa Corporation and the Delaware Health Sciences Alliance with Thomas Jefferson University, Christiana Care and Nemours.

Following Harker, each speaker shared his outlook on the economy.

Lacker began, predicting growth in the U.S. economy of about 4 percent this year and suggesting hiring would gain momentum that would in turn allow consumers to increase spending. He also called for re-evaluation of the federal monetary stimulus program.

“As the economy shows signs of improvement, we need to withdraw stimulus funding,” said Lacker.

Nickles followed, calling the present tax code “suffocating.”

“It puts us at a disadvantage,” he said. “We need to be competitive internationally, and an obsolete tax code can suffocate initiative, entrepreneurial spirit and the opportunity to expand. We need to make changes in order to move forward.”

Farr questioned the sustainability of the recovery, noting that the easy part is over. Instead, he focused on the growing wealth gap and depressed housing market.

“Large concentrations of wealth do not appear healthy for the economy,” Farr suggested. “The richest Americans continue to gain wealth while the poor do not, and this could have long-term negative consequences for the U.S. economy.”

Farr also noted that improving the housing market is key to sustainable economic improvement.

“Almost 11 percent of properties are vacant and 23 percent of mortgages outstanding are underwater,” said Farr. “This weakened housing market can negatively impact consumer spending. The federal government stimulus has been broad-based and there certainly have been some positive effects, but the question is, will it take hold and become self-sustaining?”

William Latham of UD's Alfred Lerner College of Business and Economics and the Center for Applied Business and Economic Research ended the round of presentations, talking briefly on Delaware's economy.

The event concluded with a panel discussion moderated by Jon Hilsenrath, chief economic correspondent with the Wall Street Journal.

At that time, the speakers shared their views in more depth on the bond purchase program, other stimulus funding and the need to re-evaluate the program as the economy improves. They also touched on entitlements and defined benefit and contribution plans.

Hilsenrath, in keeping the panel on its toes, also persuaded Farr to share advice on some potential stock investment choices (multinational stocks, not bonds, said Farr) and Nickles to share his thoughts on future presidential hopefuls.

Article by Kathryn A. Marrone
Photo by Kathy F. Atkinson