Saturday, February 28, 2009

Innovation is Economic Wild Card

BusinessWeek Chief Economist Michael Mandel gave the keynote address to over 400 executives at our 2009 Annual Meeting. He provided an economic overview, discussed the causes for the current economic climate, and suggested that technological innovation is the wild card for getting us out of the recession. You can view his slides and reader comments on his blog.

Mandel, a self-described optimist, noted that things look rather grim and recovery could be slow as we are in a $4 trillion dollar hole. The good news he presented is that he sees innovation as a wild card that can have upside (or down side) surprises for otherwise gloomy economists. Innovation spurs growth and creates jobs, but it is unpredictable. He notes that Infotech is ripe for innovation and that areas such as communications, social media, cloud computing and news/entertainment have matured.

His bottom line (aka "best guess"): “I’m going to go with medium-term optimism. Over the next year, the economy will be sustained by education, healthcare, and other government programs. Over 3-5 years we will see innovation-driven growth. I would not be surprised to see another boom.”

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