Expert insists there’s no need to worry about this “recessiony thing.”A large group of Maui’s business owners and bank officials gathered for a breakfast meeting in the Haleakala Ballroom at the Grand Wailea Resort on Thursday, Aug. 28, as Bank of Hawai‘i Chief Economist and Senior Vice President Paul H. Brewbaker provided a quick economic update.
Brewbaker started his talk by admitting it has been a surprising year with the losses of Fannie Mae, ATA and Aloha Airlines, but “sometimes we just have to deal with surprises.” He discussed a time recently when he walked outside of his O‘ahu office to find snow covering the street. The television show Lost was filming, and he took this surprise in stride—just how Hawai‘i should its economy.
“There are many negative surprises, but you just have to deal,” said Brewbaker. “The good news is that there are some positive surprises, too.”
Hawai‘i’s economy has held up through mid-year 2008, although growth has “slowed to a crawl.” The usual stallers remain higher oil prices, declining tourism and falling residential investment, but in all reality, Hawai‘i is maintaining throughout the country’s current economic struggles.
“The good news is the U.S. GDP (gross domestic product) growth was plus 3.3 percent during the second quarter of 2008,” said Brewbaker.
“I work with people who think a recession is going,” said Brewbaker, smiling. “I bring them the facts and show the numbers that there’s really not, though, and we’re okay. They don’t believe me.” The lively Brewbaker joked how he was unaware that in a recession, an economy could still experience growth.
He has been told his tourism forecast was “too optimistic,” and even though the “guys he works with don’t believe me,” he said, he insists on remaining positive with facts.
“As far as I am concerned, a small growth is still a growth,” said Brewbaker.
Brewbaker discussed how too many watch Fox News or CNBC, and their talks of this “recessiony thing” going on is bringing our society down. “Turn off the TV!”
“People are worried about recession so they’re not flying to Hawai‘i anymore,” said Brewbaker.
He stressed that we need to focus on the positive and discussed how it would be smart to continue to lower hotel rates to get people back here and concentrate less on housing development.
“There’s too much housing going on,” said Brewbaker.
He revealed corn to be Maui’s future in agriculture over sugarcane and laughed when asked about his projections for oil barrel prices—he “had no idea” as it is just too difficult to predict.
Brewbaker gave a positive presentation of the economy, repeatedly insisting upon the dismissal of the “recessiony thing” that has been imbedded into the public’s minds.
“Concentrate on the facts,” he said. “We can wallow, or we can think about what point we can go up.”
Bank of Hawai‘i Corp.’s earnings rose 1.2 percent in the second quarter of 2008 and ranked at the top among big banks in the country, according to the annual survey “All-Star Banking Team” from the U.S. Banker earlier this year.
For the most-to-date economic information from specialist Brewbaker of Bank of Hawai‘i, visit www.boh.com/econ.