Sonoma County's economy will keep growing, the new Rohnert Park casino will give the region an economic boost and median home prices in the region will see double-digit growth next year, economist Christopher Thornberg predicted Friday.
Once tagged “Dr. Doom” for correctly forecasting the collapse of California's housing bubble, Thornberg gave a mostly upbeat forecast to 450 business leaders at an annual breakfast sponsored by the county Economic Development Board.
Many economic indicators are as strong as at any time since he started speaking in Sonoma County nine years ago, said Thornberg, formerly a senior economist with the UCLA Anderson School of Management.
Using several dozen charts, he pointed to improvements in such areas as household debt, job creation, corporate profits and the stock market.
“We're dealing with an economy that is clearly moving forward,” said Thornberg, founding partner of Beacon Economics in Los Angeles.
His biggest concern remains elected leaders in Washington. Partisans in both parties have created tremendous uncertainty, he said, which explains why companies are failing to make large investments that would benefit the economy.
What's needed, he argued, are ways to give voters the means to elect more centrist leaders. He said California has provided possible solutions by adopting its top two primary system and changing its redistricting process, no longer allowing state legislators to draw up their district boundaries.
Thornberg acknowledged that housing construction remains sluggish. He attributed that partly to fewer families being able to qualify for loans under new lending rules.
For the Golden State, he also blamed the lack of new housing on the California Environmental Quality Act, or CEQA. The act, which Thornberg called “the most abused law ever,” needs to be reformed to allow a better balance between environmental protection and growth.