The Bank Attends Nationally Recognized Economic Forecast Conference
Chapman University Releases 35th Annual Economic Forecast Results
The Private Bank recently attended an event at which Chapman University's A. Gary Anderson Center for Economic Research presented its 35th Annual Economic Forecast. The nationally recognized event, held at the Sergestrom Center for the Arts in Costa Mesa, attracted nearly 1,500 local business executives and leaders who were eager to absorb the Center's insights on the economic direction in 2013.
Conference presenters James L. Doti, Ph.D, President of Chapman University, and Esmael Adibi, Ph.D., Director of the A. Gary Anderson Center for Economic Research and Anderson Chair of Economic Analysis at Chapman University, discussed their forecast for the local and national economy in 2013. This Economic Forecast was based on the faculty and student developed Chapman Econometric Model, which analyzes the California economy and greater global economic trends to provide national and local businesses with information to make effective planning and investment decisions in the upcoming year.
Steering clear of the fiscal cliff by year-end is the key to the forecast for next year. Dr. Doti and Dr. Esmael Adibi based their report on a reduction in government spending by $200 billion, assuming the two parties reach a political compromise. The forecast reports that both Orange County and California experienced steady job growth in several industries this past year, notably the leisure & hospitality, professional & business services, and healthcare industries. The Chapman report predicts: payroll taxes will increase as planned, from 4.2 to 6.2 percent in 2013; the Bush tax cuts will be restored for at least one more year, but not for those earning more than $250,000 per year; capital gains taxes will increase, and dividend income will be taxed as ordinary income; a portion of the fiscal cliff that calls for a reduction of $110 billion in spending will be revised downward to a cutback of $50 billion; and estate taxes will increase, and the AMT (alternative minimum tax exemption) will hit more taxpayers.
Although minor, Dr. Doti and Dr. Abidi conclude that in 2013 the state and local economy will show signs of job growth, slight gains in real income, an increase in consumer spending, and housing that will be more affordable, albeit in limited amount. These projections, along with a continued recovery for construction in Orange County, posed good news for The Bank and their clients.
To read the full Chapman Economic Forecast, click Here.
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