Coachella Valley Gets “C-” Grade In Economic Stability

C-.

That’s the letter grade given to the Coachella Valley this year regarding its overall economic status. It is a slight improvement from last year’s grade of a D.

Local research economist John Husing gave those grades. “Conditions have improved this year versus last,” he said. “Are we out of the woods? No.”

Husing presented his findings Friday to a packed ballroom at the Renaissance Esmeralda Resort and Spa. Over 700 of the desert’s movers and shakers attended.

Husing says he analyzed eleven sectors that bring outside money to the Coachella Valley, such as construction, agriculture, healthcare and tourism.

What’s holding back the desert?

“The answer is simple: It’s the whole problem we have with the mortgage crisis and all the problems with foreclosures,” he said. “And until these are fixed, we can’t recover because it’s too big of a sector for us.”

Keynote speaker Todd Buchholz agreed. The former White House Director of Economic Policy under President George H.W. Bush said it is going to be a long struggle.

“You’re really talking about a year-and-a-half to two years before the banks are going to start feeling much more comfortable lending money to small businesses,” he said. “And small businesses create most of the jobs.”

Husing predicts one of these four groups will have to take a massive hit in order for the Coachella Valley to recover: homeowners; banks; mortgage-backed security holders; or taxpayers.

If the group takes the massive hit soon, then the economy may start feeling normal beginning 2012. Otherwise, we may have to wait until 2014, Husing said.