UNC’s Smith Looks Into His Crystal Ball Once Again

James F. Smith, venerable economic forecaster from the University of North Carolina at Asheville, will be looking into his crystal ball for the 29th time at this week’s annual Crystal Ball Economic Forum held at UNC for the past 30 years. Joining him for the 27th consecutive year is David Berson, Nationwide Insurance’s chief economist.

These two have become an institution on campus: every April gazing into the future based on their knowledge and analysis of the past; giving investors a heads-up on what they can expect in the near, and not-so-near economic future.
Their batting average is not too bad, either. They predicted the Great Recession.

“What stands out in my mind is how these guys have been right on the big calls, not necessarily where the Dow Jones was going to stand in 12 months, but where the economy will be,” said Joe Sulock, UNCA’s Owen Professor in Economics and organizer of the Crystal Ball.

What Smith says he did not foresee was the depth and breadth of the Great Recession, which still has him somewhat stumped.

“No one alive has ever experienced such a slow rebound in the U.S. From 1921 through 2013, through the Great Depression and World War II, the gross national product on average has grown by about 3.2 percent a year. We haven’t had a year over 3 percent growth for almost a decade,” says Smith.

Smith says he is optimistic about the economic future in store. When he looks at the data over the long run, he says betting on the future is  simple logic. During the 20th century the US economy grew ten times more often than it contracted. The average length of the 11 recessions experienced from 1945 through 2001 was only 10 months.

“We should see many new economic records set in the U.S. and around the world in 2014 and 2015,” Smith said.

Forbes Spotlight on Charles Brandes

In a recent article for Forbes, Michael Maiello takes a close look at one of America’s finest investment managers, Charles Bandes. Brandes follows the long-term value investing model started by Benjamin Graham and David Dodd.  As Maiello explains, “One strategy Brandes has used to good effect is based on the theory that, despite the bankruptcy risk, firms that have lost massive market value make the best stock picks.”

In one example, Maiello describes how Brandes, in January of 1998, acquired the debt-ridden Reebok company. Brandes stuck with Reebok, even when stocks hit a low of $10 in 1999. When he unloaded in January of 2001, it was at $30.  As Brandes explained,  “A mutual fund manager who owns a company into bankruptcy risks the ire of his shareholders, and his job. I’m not afraid to hold a controversial company.”

In another example, Charles Brandes bought Elf Aquitaine, which is a privatized French oil company, when it was dealing with high production costs and other issues. But he liked the company’s solid assets and he had already gained 120% when the company was purchased by TotalFina in 1999 for $52 billion.

As Maiello explained in his introduction, “One of Wall Street’s oldest saws, “Never try to catch a falling knife,” doesn’t impress investment manager Charles Brandes.”

The Business of Ed Sayres’ Inspired ASPCA

Ed-SayresIt may be a non-profit organization, but The ASPCA encountered substantial fiscal success due to a change in pace of its fundraising efforts.  It was Ed Sayres who turned things around, while he was CEO and President between 2003 and 2013.

Based on Sayres’ philosophy—“Say what you do, do what you say” – between 2003-2009, revenues at the ASPCA shot up from $43 to $116million.  Sayres basically altered the organization’s fundraising model from annual/semi-annual model to a monthly contribution model.  He did this because of what he witnessed early on in his career.  Once he joined ASPCA, he set the organization’s goal to reach 150,000 monthly donors within four years.  He transformed expectations.  Sayres explained that success was not a mere case of small annual gifts and instead looked toward an organization’s capacity to “cultivate long-term relationships.” Thanks to Sayres’ philosophy, today, 60 percent of the ASPCA’s net revenue comes from 200,000 monthly donors.

Ed Sayres has dedicated over three-and-a-half decades to enhancing the lives and welfare of animals.  During this time he has made strides in the issues of pet overpopulation and animal cruelty.  It was due to Sayres’ entrepreneurial mind that the ASPCA increased to higher levels of national prominence, developing strong partnerships nationwide.

Commercial Real Estate Market On the Rise

The commercial real estate market has been doing exceptionally well in the Eastern U.S. since the start of this year. Companies with a focus on the region, such as Northland Investment Corporation with CEO Steven P. Rosenthal, are being swept into a pace that, according to local brokers, hasn’t been matched in years. During the first two months of 2014, Erie County saw almost $120 million worth of commercial property deals despite the frigid weather. Robert Strell, a broker and owner of MBA Consulting and president of the Western New York Commercial Association of Realtors, said: “It’s almost staggering, I’ve got to tell you. We knew there was action and activity, but the total is a big number and there’s a lot more coming down the pike.” Experts have said that given the current rate, the market may surpass the half-billion-dollar mark and post more than $720 million in deals throughout the rest of the year. The activity recorded in January and February is high-priced, with deals exceeding $5 million in value and some reaching as high as $15 million. Amy Nagy of Hastings Cohn Real Estate confirmed this positive outlook, stating: “It’s highly busy in this first quarter. There’s a lot of momentum in the market that’s generating things moving along.”

Colliers Hires New President for US Operations

Collier International is expanding its executive team by creating a new position for Craig M. Robinson. Robinson will take over as president of Colliers’ US operations. He will have the job of managing all the daily business of the company’s commercial real estate services, including business development and operations. Robinson will be directly supervised by Colliers’ Americas’ CEO Dylan Taylor.

Before joining Colliers Robinson was the president of corporate services at Cassidy Turley, overseeing the firm’s corporate services business. He was also responsible for the operations of accounts and strategic planning. Robinson also took part on the executive committee of the board of directors.

Taylor discussed the crucial role Robinson will be playing in the organization and success of Colliers:

“His strong experience in corporate services, equity investments, and government and public-sector occupier services–as well as his banking and consulting experience–gives him the breadth and depth of knowledge necessary to lead our U.S. business.”