http://timesunion.com/AspStories/story.asp?storyID=729941&TextPage=1

Quoted Text

Times are fine right here, for now
Is there an economic disconnect between our region and the world? Yes and no

By CHRIS CHURCHILL, Business writer
First published in print: Thursday, October 16, 2008

Recession? What recession?
     
Looking around the Capital Region, you wouldn't know the nation is in the midst of an economic downturn, that there is turmoil on Wall Street and a crisis in the credit markets.

Over the weekend, Crossgates Mall and Colonie Center were jammed. Downtown Saratoga Springs teemed with visitors. At least one restaurant in Troy said it was flush with customers because of EMPAC, the glittering new performing arts center at Rensselaer Polytechnic Institute.

And then there is Advanced Micro Devices, which last week said it would go ahead with its $4.6 billion chip-fabrication plant in Malta.

Let the good times roll!

But wait. Isn't Wall Street, where the Dow Jones industrial average plunged 733 points Wednesday, just hours away by car or train? Isn't the economy, according to polls, the top concern of Americans?

Is the apparent disconnect between the Capital Region and the rest of the world real? Or is imaginary?

Economists and other observers say it's both. The Capital Region, they say, has always been resistant to down times because the big industries here — state government, education and health care — are typically stable.

"The beauty of the Capital Region is that we don't see the volatility of other parts of the country," said Severin Carlson, dean of the business school at The College of Saint Rose in Albany. "We don't see the highs that other regions see. And we don't see the lows."

But even in the Capital Region, there are subtle signs of economic stress.

RPI, for example, announced this week it will enact a hiring freeze, following state government's lead. The unemployment rate has slowly climbed. And banking executives say they're noticing an increasing number of local bankruptcy filings and higher loan-default rates.

Then, there is the real dark cloud: The ever-growing state budget deficit, largely caused by decreasing Wall Street revenue.

"New York state government is going to go through a crunch," said Kajal Lahiri, professor of economics at the University at Albany. "The local area is not looking bad right now. But it's not going to continue like this."

The state of Massachusetts cut 1,000 jobs from its payroll Wednesday to close its own budget gap. A similar move by New York would quickly hammer the Capital Region, observers said.

Even if New York only reduces spending, the impact could trickle down through the area's economy.

"We are going to see the ripples from this recession," Saint Rose's Carlson said.

But for now, at least, the spending continues.

Nationally, much of the housing market has been in a tailspin. But Eric Dahl, managing partner at Community Realty in Albany, said the local housing market remains active. And buyers with good credit can still get mortgages — despite the national credit crisis.

"For the solid house in an affordable price range, there's still stiff competition," Dahl said.
Likewise, retail sales are down nationally. But Joseph Millett, general manager at Colonie Center, said the mall was mobbed last weekend and "is not seeing slippage" in sales revenue.
Millett surmised that shoppers are breaking loose because they're no longer constrained by sky-high gas prices and some other costs.

And in Saratoga Springs, William Roach, owner ofPutnam Wine, said both Broadway and his downtown store were busy in recent days, no different from this time last year.

He compared the scene to the weeks after the start of World War I, when the English continued to frolic on beaches, seemingly unaware how their lives would soon change.

"The fact that circumstances have changed in recent weeks doesn't immediately change behavior," Roach said. "People's habits are pretty established."

Chris Churchill can be reached at 454-5442 or by e-mail at cchurchill@timesunion.com.

There is no freakin' disconnect.....been to the market or Kmart.....I went to buy one of those acrylic sweaters at Kmart that sold for between $7.00 and
$10.00 ($10 beinq the hiqhest price and obscene at the time) now they want what??????????????????----$16.00........

so NO WE ARE NO DIFFERENT.........and as far as that china crap.....we are !@$%$%$^$%&&%&%$*^&J*(@!@#$!@------THEY FREAKIN' OWN US.....

THAN YOU conqress and wallstreet and the qlobal..........SO NOW WHAT FOLKS???????????????????????????????????????????