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Economic analysis, with a twist of humor

November 03, 2009|By ANDREW SCHOTZ

WASHINGTON COUNTY -- From stocks to mortgages to lost jobs, Anirban Basu mapped out the economy Tuesday with a ream of charts and dollops of humor.

Basu's analysis and irreverent bluntness is a staple of the annual Washington County Economic Summit, which the Chamber of Commerce and Economic Development Commission co-sponsor.

At Tuesday's summit at Fountain Head Country Club, Basu -- the chairman and CEO of Sage Policy Group, a Baltimore consulting firm -- riffed on:

o Cumberland, Md.: "The hottest housing market in these here United States," as he called it. A chart of nine hot metro housing markets had Cumberland at the top, with median house sales up about 22 percent from 2008 to 2009, as Washington and Garrett counties got more expensive. Commenting on a hot housing city in New York, Basu quipped, "You don't buy in Buffalo to impress a girlfriend. It's because you can afford it."

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Four Florida cities were among the 10 worst-performing metro housing markets, making them prime targets for predatory buying, he said. "It's as American as baseball, apple pie, mom and Toyota to take advantage of Floridians," Basu joked.

o Scattered signs of economic health: Sales in U.S. retail and food services, like many other industries, have been dropping dramatically the last few years, but losses are becoming smaller. "Less worse is the new excellent," Basu said.

Among chain businesses, apparel and department stores' sales declined since last year, but drugstores' sales grew. "We are still medicating ourselves," he said.

o Spendthrifts: Basu said America's new era is "the end of the Starbucks economy," when people paid $4 a cup for coffee, two or three times a day.

Now, affordability has overtaken prestige in clothing, homes and cars, he said.

Basu said the $787 billion federal stimulus package doesn't address shortcomings such as a poor high-speed rail system or air-traffic control.

Only $131 billion is devoted to infrastructure, mostly road resurfacing. "That means we can get to Wal-Mart that much faster," he said.

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