The Race Between Positive And Negative Forces In The Economy Is On

Quote for Today:

“A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain.”

– Robert Frost

(Somewhere in Switzerland)

Global real estate services provider JLL sent me its Economic Insights report the other day. While it’s a private publication, I’ve been given free rein to quote it as I’d like. And since I like sharing information with you to improve your investing experience, I’m not going to pass up on this approved opportunity.

Written by JLL Chief Economist Ryan Severino, it begins like this:

Since the beginning of the year, we have emphasized our optimism about the longer-term outlook for both the U.S. and global economies. Growth prospects look favorable through at least the middle of this decade. But we also reiterated that, while we are heading for the light at the end of the long, dark tunnel, we have not reached the end of the tunnel yet.

And we highlighted something unusual: the uncertainty in the economy remains concentrated in the first half of 2021, not the longer-term. That presents an unusual circumstance for economic forecasting because projections typically become uncertain further into the future… the race between positive and negative forces in the economy is on.

Severino fully admits that there’s no reason for premature celebration – a fact that the markets seem to have gotten a clue about this morning. There are renewed virus fears and renewed lockdowns, for one thing, which are leading to more economic pain around the world. And while we’re told that “help is on the way,” we “have not yet reached a turning point where the pandemic begins to subside.”

So what does that mean for commercial real estate, which “takes it cues from the overall economy”?

To answer that question, Severino points out the obvious: that the faster the economy recovers, the faster CRE will. What’s less obvious is how there’s both a positive and a negative side to consider when it comes to how fast everything gets back up and moving like it used to:

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Brad Thomas is the Editor of the Forbes Real Estate Investor.

Disclaimer: This article is intended to provide information to interested parties. As ...

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