BASF Meeting at Extension Hillsborough County

Join us at the Extension Office as we discuss weeds and pests with guest speakers from UF/IFAS and BASF!

FNGLA Lake Region Meeting

Florida Nursery Growers & Landscaping, Assn.

LAKE REGION CHAPTER

FEBRUARY MEETING

   

WANTED

 Your Best POT of CHILI to Share

4TH Annual Chili Cook Off!!!

(with prizes to win!)

DATE: Tuesday, February 5, 2019
LOCATION: POLK COUNTY EXTENSION OFFICE
in the Valencia Room,1700 HWY 17 & 98 SOUTH, BARTOW, FL 

SOCIAL TIME: 6:00 - 6:30 P.M.DINNER TIME: 6:30 P.M

PRICE:   $15.00

WHAT’S FOR DINNER?
Chili, Bread/Crackers, Brownies & Drink Provided
RSVP by February 1, 2018 via email or 863-644-6491

PROGRAM TIME:   7:00 P.M.

Earn 1 CEU for Pesticide License
Topic: Calibration and Respirator Safety
BY: Mr. Chris Oswalt
our Polk/Hillsborough County
Extension Citrus Agent.

Any questions please call Karen @ 863-644-6491

Business Outlook 2019

(freeimages.com)

I learned at an early age, while fishing from a jon boat in the Everglades, to always keep an eye on the horizon for stormy weather.   I remember a particularly bad storm that blew in from the northwest behind a high levee we were aside (facing east). It was on top of us before we could start the motor and outran our low “h.p.” engine on the race home.  We had a real small motor on that boat and I am sure that the “h.” stood for hamster because there were definitely no horses pushing us that day while we laid low in the boat and prayed lightning wouldn’t strike us.   Watching the horizon for storms is also a good idea for the nursery business and the business cycle in general. 

As we turn another year over, it is probably a good place to start to check the business “horizon” in the year ahead.  Looking at the “skys,” the weather seems decent and the near forecast (two quarters out) looks good at about a 2.5 - 2.7 % GDP increase (IMF, The Conference Board).  However, there might be some clouds brewing on the distant horizon. 

A notable leading indicator of recession is the spread between the 10-year Treasury note and the three-month Treasury bill.  This can be an indicator of recessions about a year in the future.  When the yield spread between the two drops below zero, a recession may be on the horizon.  Although this doesn’t exactly couple, there is increasing probability with the inversion of the spread (going below zero).  If you would like more information on this topic here is the research paper  https://www.newyorkfed.org/medialibrary/media/research/current_issues/ci2-7.pdf?utm_campaign=JM-305&utm_medium=ED&utm_source=ska

As I write this, the yield spread is 0.26 and we can see as a predictor that there is about a 19% chance of a recession this year.  I would feel confident going out in the jon boat without a rainsuit if this were a rain chance.  However, the trendline seems to show that the inversion will occur between Q1 or Q2 in 2019.  That would put the risk of a recession increasing and a forecast for a recession event about Q2 2020.

Another useful economic indicator tool is the Econ P.I. site.  (www.econpi.com) by David Rice.  This is a conglomerated graphing of 19 economic indicators and shows rate of change and an overall mean computed.  Depending upon which quadrant of the graph the means are calculated, informs where the business cycle is and where it is moving. Some of the indicators are turning negative and his computation is showing an aggregate mean moving towards an indication of a slowing economy.

Even with all the vagaries in the economy, we still have a predicted good year ahead of us.  The prediction is that the US will have about a 2.7% growth in GDP for 2019 (Conference Board). Which should translate into a good business environment.  The architectural billings index for Nov. 2018 showed a slight uptick above 50 for the Southern region, which translates towards a slight increase in architectural services for non-residential construction and is a forecast of about 9-12 months of building in the future. 

So, if I was making the forecast (and I am no economist), as things stand, this should be a decent year for our industry.  For crops that are looking at a multiple year production cycle (trees, palms, etc) start thinking about how you can weather a recessionary storm if one happens in 2020.   Whatever you grow, now is the time to check your “business engine h.p.” and ditch the hamsters.  Make sure your horses can outrun or out-weather the potential storm if it brews up. 

Another thing I learned, is that when it comes to predicting weather, economy, or fishing, sometimes your guess is probably as good as the experts. We still have a long way to go to getting those forecasts right.

All the best in 2019!