You might think that after two years of depressing economic figures, the attendees and speakers at the
VMA Market Outlook Workshop, which was held in
Chicago August 12 to 14, would have pessimistic attitudes.
But this year’s news was not all bad—in fact if a main
theme arose it was: we are on the road to recovery.
Speakers differed on what that road would look like and
how much it had been washed away from the storm of the
last few years. But most said permanent changes may have
occurred in the process, such as increased attention on
finding new sources of fuel and the need to focus more on
what’s happening in the entire world, instead of just
domestic markets.
Looking at the short term, the bright spots in industry
are the same as last year: energy and power continue to
present great opportunity; the water and wastewater
markets cannot help but grow going forward because of
sheer need; opportunities continue to grow in countries such
as China and India. But perhaps most reassuring of all, the
long-term outlook has not changed, and that is: the valve
and actuator industry has traveled down treacherous
economic roads before; and, as before, most companies will
arrive on the other side of this recession stronger and more
knowledgeable about how to be successful.
The Recession in Historical Perspective—World Economy
9
6 3 0 – 3 – 6 – 9
Source: IHS/Global Insight
–Real GDP
— Industrial Production
– 12
1972
1977
1982
1987
1992
1997
2002
2007
2012
RECURRING THEMES:
; The shape of the recovery. While speakers’ ideas differed on exactly how long before the nation starts climbing its
way back up, most said they do not see a W-shaped recovery. In other words, there should be no second leg to the
recession. However, most also agreed that the path back up the hill won’t be an easy one—the recovery will take
some time in coming.
; A caution on unemployment. Since unemployment lags behind other indicators, most speakers pointed out that the
joblessness rates have not yet bottomed out. Further pain will be felt before the situation improves.
; Capital is king. Most presenters said the companies in the firms they were talking about that have been the most
successful in riding out the recession were ones that were able to shore up cash and ensure they had sufficient
working capital. Several speakers also pointed out, however, that the lending squeeze is starting to loosen and a few
even said it may be time to start looking at wise ways to spend.
; The effect of stimulus. Many of the speakers said the stimulus packages, both here and abroad, may play a role in
what sectors will see the fastest recovery. In China, for example, the government is pouring money into
infrastructure projects. Several speakers, in addressing U.S. stimulus packages, pointed out that because of timing,
projects that are already in the design stages or that can be put together quickly, may be affected the most.
