DATE: July 15, 2008

CONTACT: Contacts listed below

WRITER: Teresa C. Hopkins, (864) 656-1222
hopkin1@clemson.edu

WRITER: Ross Norton, (864) 656-4810
rnorton@clemson.edu

Economic experts from Clemson University

The economy is foremost on the minds of Americans right now. Soaring oil prices, rising food costs, the mortgage crisis and a stock market in decline are combining to make this the most challenging climate in years. Clemson University experts are ready to offer their insights into what's happening and how to cope.

There was a time when Herbert Hoover's promise of a chicken in every pot and a car in every garage sounded like high-minded ideals or maybe high-falutin' campaign talk. Nowadays, two cars are in the typical family garage while chicken every day sounds like a poor man's rations. So what do we mean when we say times are hard? Do we know how to deal with economic challenges? For some perspective on how tough times really can be, talk to history professor Roger Grant, an expert on America's Populist-Progressive Era. Contact Grant, the Kathryn and Calhoun Lemon Professor, at (864) 656-5371. Contact Ross Norton (656-4810 or 207-1157) in News Services for assistance.

Breazeale Professor of Investments John Alexander does not anticipate an economic recovery in 2008. “Originally, many analysts were anticipating this soft spot to be similar in duration to other soft spots we have had in the past. But, in my opinion, there are several items that will come into play to lengthen the duration of this slowdown,” he said. First, energy prices and to a larger extent commodity prices are putting a real drag on the economy and the consumer. Second, the pull-back in real estate prices has had a sobering effect on many Americans. Third, the balance sheets of our financial institutions may still have some storms to weather. Fourth, credit is scarce. Fifth, the market feels interest rates will be increasing. For information contact Alexander at (864) 656-0547 or News Services’ Teresa Hopkins (656-1222 or 207-1163).

The price of gas is a boon to one industry — the “staycation” — but unfortunately for the economy, it’s an industry born of the need to keep money out of circulation. Summer vacation is the “ultimate democratic experience” according to Bill Norman, associate professor of parks, recreation and tourism management, but people aren’t just cutting back now, many are choosing no travel at all. Contact Norman at (864) 656-2060 or Ross Norton (656-4810 or 207-1157) in News Services for assistance.

As gas prices go up, it is tougher to spring for an ICEE for the youngsters during a fill-up at the local convenience store. How do you explain tough economic times to children? Nancy Porter, a professor and family resource management specialist, says many people try to shelter their children when economic realities hit home. Most of the time, children understand and respond well, sometimes even taking an active role in tightening the family purse strings if parents will sit down and explain the need to reduce spending. Porter and Deborah J. Thomason are co-authors of the publication, “Taking Charge in Challenging Times.” Contact Porter at (864) 656-5718 or Ross Norton (656-4810 or 207-1157) in News Services. See a video of Porter talking about today's economic pressures.

Additional financial challenges often mean additional family stress. Families should take care not to let new financial reality bring too much stress into a household, especially for children, says Deborah J. Thomason, professor and family and youth development specialist. Thomason and Nancy Porter are co-authors of the publication, “Taking Charge in Challenging Times.” Thomason can be reached at (864) 656-5721, or call Ross Norton (656-4810 or 207-1157) in News Services for assistance.

With Fannie Mae and Freddie Mac under scrutiny as Congress labors to create a mortgage rescue package, the once high-flying real estate market seems considerably more fragile. The creative financing practices of the last five years have created the problems, says Elaine Worzala, director of the Center for Real Estate Development at Clemson. Worzala predicts a much-needed return to traditional real estate financing. In recent years, many lenders were writing loans as if there were no risk, then selling off that risk to Wall Street, she says. Contact Worzala at (864) 656-3657 or Ross Norton (656-4810 or 207-1157) in News Services for assistance.