Good growth ahead for U.S.
economy if Washington ‘gets out of
the way,’ noted economist says
The U.S. economy will see solid growth starting in the second half of
2013 and for all of 2014 as long as Congress and the Obama administration don’t conspire against it, a leading U.S. economist predicted.
Dr. Donald Ratajczak, emeritus professor at Georgia State
University’s J. Mack Robinson College of Business, forecast second-half GDP growth of between 3.0 and 3. 25 percent, followed by a similar expansion in 2014. Most of this year’s growth will be back-loaded, with momentum building in the summer and carrying
through into all of next year, Ratajczak told the SMC3 annual winter
meeting in Atlanta.
The U.S. will experience muted growth in the first half of 2013 as
fiscal concerns and ongoing political squabbles affect consumer and
business confidence, and the economy works off a temporary condition of elevated auto inventories, he said. The first-half weakness will
temper full-year gains, with 2013 growth expected to be around 2. 2
percent, Ratajczak predicted.
Ratajczak said the uncertainty over fiscal issues and the polarizing
climate in Washington remain a concern. However, he predicted the
White House and Congress would ultimately reach compromises on
key economic issues because no one wants to take the political fall for
derailing the progress that’s already been made.
The economist said industrial production activity is gaining
strength, household wealth is approaching levels last seen prior to
the 2007–09 financial crisis and recession, and energy prices have
peaked for the year. Inventory levels are in balance, and in the case of
building materials, are actually tight, Ratajczak said. As the housing
market recovers after five difficult years, lean inventories of construction materials will trigger increased ordering activity and spur
overall economic growth, he added.
The U.S. will emerge as a major energy producer and exporter, as
shale oil and gas discoveries in the Dakotas, Montana, and
Pennsylvania make it an export powerhouse, Ratajczak said. He cited
data showing that the U.S. exports the equivalent of $11 billion of
petroleum products each month and is poised to become the world’s
second-largest producer of liquefied energy materials in two years,
overtaking Russia and trailing only Saudi Arabia.
The rock-bottom price of natural gas will be a tremendous tailwind for the U.S. economy in general and the supply chain in particular, according to Ratajczak. Historically, the market price of crude
oil has been about 12 times the market price for natural gas.
However, recent mild winter weather, a sluggish economy, and newly
abundant resources of natural gas have widened the ratio to about 30
to 1. Ratajczak predicted that the oil to natural gas ratio would not
drop below 25 to 1 for the rest of the decade.
“You will not go back to the historical levels of 12 to 1,” he told the
audience. ;
ground breakers
Advanced Logistics and Fulfillment,
which specializes in the assembly of
point-of-purchase displays, has signed a
new lease agreement at Hunt Midwest
SubTropolis, the world’s largest underground business complex in Kansas City,
Mo. The new agreement expands the
fulfillment company’s facility by 90,000
square feet, bringing the total space
leased to 241,925 square feet.
Intelligrated buys Knighted
Material handling solutions provider
Intelligrated said it has completed the
acquisition of Knighted, an Ossining, N.Y.-based developer of supply chain software
solutions.
Knighted provides Web-enabled logistics
software for supply chain operations. Its
applications include warehouse management software, warehouse control systems,
and labor management software.
Intelligrated provides material handling
systems, warehouse control systems, and
order fulfillment software.
Cincinnati-based Intelligrated said the
acquisition is part of the company’s strategy to deliver solutions for the e-commerce,
multichannel retail, third-party logistics,
wholesale, consumer products, and food
and beverage industries.
“Today’s multichannel retail and con-
sumer demands require fulfillment opera-
tions to deliver orders faster and more effi-
ciently than ever before,” said Greg Cronin,
executive vice president of Intelligrated, in
a statement. “The acquisition of Knighted
enhances Intelligrated’s ability to deliver
modular solutions that are not only easy to
implement and upgrade, but are also capa-
ble of making decisions at the speed of
automation, increasing distribution and
fulfillment capacity, and lowering supply
chain costs.”
Knighted will continue to operate inde-
pendently under the Intelligrated umbrel-
la. Over the coming months, Intelligrated
and Knighted will integrate select adminis-
trative operations and combine software
development resources. ;
