RECESSION HERE SOONER THAN I THOUGHT

Below I predicted that Tucson would be in a recession by next summer. Now, two local economics profs think it's already here. Even if it turns out to be a mild recession, as they predict, Arizona and Tucson are chock-full of people who will be hurt pretty badly. To give you a sense of this, about 20% of Arizonans qualify for Medicaid.


AZ likely in recession, 2 at UA say
By Christie Smythe
Arizona Daily Star
Tucson, Arizona Published: 12.08.2007

Two UA economists made the unhappy announcement local business leaders have been fearing Friday: We're probably already in a recession. Marshall Vest, director of the Eller College of Management's Economic and Business Research Center, told an audience of about 750 the housing slump is driving the economic downturn.

Vest expects the recession to last through 2008 and the economy not to reach full steam again until 2010, he said.

Arizona is among five states in the nation either in recession or on the verge of it, Vest said. The others are Michigan, California, Florida and Nevada, he said. For most, the primary cause was likely a boom and bust in the housing market with heavy speculation and prolific use of risky mortgages, he said.

With more than 9,000 homes on the market, Tucson has about 12 months worth of inventory compared with about 10 months nationwide.