— Economic growth in the United States is expected to level off in 2020 without spiraling down into a recession, according to Federal Reserve Bank of St. Louis President and CEO James Bullard.
“If the economy slows to its potential growth rate, then we say it’s a soft landing,” Bullard said yesterday at the Wisconsin Bankers Association’s Economic Forecast Luncheon in Madison. “If it slows below, or goes even further and crashes into recession then we say that’s a hard landing. Right now I think we’re not in the hard landing category.”
In the second and third quarters of 2018, the national economy was growing at a year-over-year pace of over 3 percent as optimism was driven by deregulation and the corporate tax cut of 2017.
Since then, U.S. growth has been slowing, which Bullard said was “not unexpected” due to trends in labor force and productivity.
“So now it’s coming back down toward 2 percent, and then the question has been whether [growth] would continue to sink there or whether it would flatten out … the expectation has been that it will continue to flatten out,” he said.
In a Q&A session with reporters, Bullard said he’s happy with where interest rates are now and doesn’t see a need to change them for the next year or so. He noted federal regulators made substantial moves to change U.S. monetary policy last year, “and now we should wait and see what the effects are in the first half of 2020 and beyond that.”
Bullard also discussed how uncertainty surrounding global trade agreements has chilled global investment as well as the global growth rate.
“Trade issues are important inside the United States, and they’re important in places like Wisconsin here, but they’re even more important outside of the U.S.,” he said. “Global investors care a lot about what the U.S. is going to do on trade policy, and how that’s going to affect global supply chains.”
— This week’s episode of “WisBusiness: the Podcast” is with Rose Oswald Poels, president of the Wisconsin Bankers Association.
In the podcast, Oswald Poels discusses her biggest takeaways from the 15th annual Wisconsin Economic Forecast Luncheon, highlighting comments from WEDC Secretary and CEO Missy Hughes as well as Bullard.
She also discusses results from recent polling of WBA members showing bankers in the state have a largely positive outlook for Wisconsin’s economy in 2020.
“I’m very pleased to report that for several years in a row now, we continue to see steady growth in Wisconsin throughout 2019, and expect that positive trend to continue through 2020,” she said.
In her comments to luncheon attendees, Poels noted the banking industry saw 17 mergers announced in 2019 that affect Wisconsin banks. But she expects the pace of bank merger activity to decrease in the coming year.
“Despite these mergers, the size of Wisconsin banks will continue to grow throughout 2020 as they did last year, as long as the economy continues its moderate growth rate,” she said.
She cited a recent survey of WBA member CEOs that found 95 percent expect the state’s economy to stay strong or improve this year.
See a full list of podcasts, sponsored by UW-Madison: http://www.wisbusiness.com/category/podcast/
— Gov. Tony Evers has assigned the GOP-controlled Legislature “homework” for the upcoming year, calling on lawmakers to address a range of topics including homelessness, contaminated drinking water and the so-called “dark store” loophole.
Evers, a former teacher and state superintendent, in a letter to lawmakers identified a number of already-introduced bills he wants to see passed by the end of the session.
But Senate Majority Leader Scott Fitzgerald slammed the missive as “condescending” and said it “won’t help him grow support for an agenda with Senate Republicans.”
“The tone of this letter is ridiculous,” tweeted the Juneau Republican.
Assembly Speaker Robin Vos, meanwhile, tweeted “#condescending is a polite term for what it is” in response to a tweet from Sen. David Craig, R-Big Bend, about the letter.
Evers opened the letter by referencing a similar communication Assembly Republicans sent him last January outlining 11 legislative goals. The guv highlighted five — income tax reductions, enhancing high-speed internet, support for K-12 education, addressing the debt level in the transportation fund and infrastructure investments — in which “we were able to make significant progress.”
He then highlighted the already-introduced bills for the upcoming year. Those include measures to cap the price of insulin, close the so-called “dark store” loophole, create PFAS standards to address contamination of drinking water, prevent a future backlog of sexual assault kits, address homelessness and alleviate the burden on local governments caused by “unexpected” special elections.
— The Wisconsin Counties Association is applauding the work of the Speaker’s Task Force on Water Quality, which recently proposed a $10 million investment in water quality in the state.
The task force was commissioned last January and included Reps. Todd Novak, R-Dodgeville, and Katrina Shankland, D-Stevens Point. They held 14 hearings around the state before making their 13-bill package of recommendations.
“They met with a wide array of stakeholders in every corner of Wisconsin,” said WCA Executive Director Mark D. O’Connell. “This truly was a bi-partisan effort and we look forward to continuing our work with the task force and the full legislature to put in place sensible and workable solutions.”
— Several state business groups are crying foul after Crawford County officials recently approved a temporary ban on construction or expansion of large farming operations while the county conducts a review on related health impacts.
The county Board of Supervisors voted last month to enact the one-year moratorium, which applies to concentrated animal feeding operations, or CAFOs. The ban applies to operations with more than 1,000 “animal units,” which equals 700 dairy cows, 1,000 beef cattle or 2,500 hogs.
The move comes after the board previously passed a resolution highlighting potential impacts of groundwater contamination in the area, which has distinctive bedrock that leads to quicker contamination.
In a letter sent to board leadership, Wisconsin Manufacturers and Commerce General Counsel Corydon Fish says the business groups are “deeply concerned with the lack of citation to valid legal authority” for the proposed moratorium.
“Moratoria are one of the most intrusive regulatory burdens government can impose on businesses,” he said. “When a government makes the decision to do so, it must have the appropriate legal authority and policy basis. In this instance, the county does not appear to have either.”
The other groups that signed onto the letter were the Wisconsin Dairy Alliance, which lobbies on behalf of CAFOs, and the Wisconsin Pork Association.
In a release touting the moratorium, Midwest Environmental Advocates notes that health and safety issues related to these large farms have been “a source of growing concern” for residents of southwest Wisconsin.
The American Public Health Association recently called on government leaders across the country to ban any new CAFOs or expansions until more is known about how they affect human health.
# Wisconsin follows national decline in cancer death rates
# $48.3 million distribution facility planned in Kenosha
# Advocate Aurora divesting two hospitals in central Illinois
# UW Hospital among first centers to perform new kind of heart transplant
– Cayley Vande Berg named 2020 Wisconsin Fairest of the Fairs
– Chicago Fed CEO Evans confident in U.S. economy despite uncertainties in Middle East
– Southwestern Wisconsin villages hit by repeated floods receive new federal mitigation grant
# FOOD AND BEVERAGE
– New late-night mac and cheese restaurant, speakeasy coming to Bay View
# HEALTH CARE
– Epic adds to Storybook Campus with Castaway and Mystery buildings
– Medical Technology Management Institute opens HQ in Milwaukee County Research Park
– Dane County health officials want tighter vaccine controls
– Lawsuit against Central Sands, Wysocki Farms growing
– Michael Best Strategies acquires Milwaukee-based Bottom Line Marketing & Public Relations
– Evers assigns ‘homework’ to legislators: Clean water, cap insulin costs, address homelessness
# REAL ESTATE
– Irgens says 770 North will remain an office building
– Central Standard Craft Distillery to add tasting room, event hall in historic downtown building
– Regulators: Proposed power line in northern Wisconsin must follow existing route
– Kohl’s reports slight downturn in 2019 holiday sales
– Pick ‘n Save parent Kroger launches plant-based meats brand
– Milwaukee streetcar to stay free in 2020
# PRESS RELEASES
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