Always personable, his take on the housing market in a recent interview was that it was bleak and about as bad as it can get. Speaking before the federal government officially announced the country was indeed in a recession, Dr. Barbera had already, for all intents and purposes, announced the same declaration and went so far as to say the rebate checks, courtesy of the government and sent to Americans to jump-start spending would be futile even before the checks were mailed out. He conceded that the money was needed by many, but that it was a failed attempt in its intended purpose. He has been quoted as saying, “It will make things look better than they are for a few months, but it doesn’t change the fundamentals. The underlying circumstances are unambiguously recessionary.” Not surprisingly, he nailed it. Now that we are in the perspective that allows hindsight, no words have been truer than those spoken nearly a year ago.
It is rare to find one who will go against the grain, stand against the majority, and speak those words that make weaker souls most uncomfortable. Still, this is a man who will not back down when he speaks what he believes. His thorough understanding of all things economic and his talent for explaining in understandable terms to those of us who are not as familiar with them has somehow bridged the general American public with the Wall Street and other political souls. If you are wondering how long it takes a cut in interest rates by the federal government to come full circle, or what the purpose of the General Accounting Office (GAO) in DC is, or are searching for the best-educated guess regarding what the year holds from a financial perspective, Robert Barbera is your man.
In a sensible approach in late 2007 which had no room for Chicken Little antics, he warned that until and unless the federal government had a more aggressive approach to calm fears in the mortgage sector, the foreclosures that had already begun in record numbers would not only continue, but would result in lenders closing their doors and even more foreclosures that would continue until the housing market had been battered and weakened so much it might require a complete overhaul. With the warning signs already in place then, and which now appear to be coming full circle in this first month of the new year, he further warned that investments, bank loans, and other economic trends would suffer for several years.
At a time when explosions in distant countries can affect the financial spending habits of those here in America, a solid approach that is neither too conservative nor liberal is what often guides us to more stable footing. This might be why Robert Barbera has such an impact. Adding to this image is his loyalty to the process itself versus those who are in the position to affect the markets.
With each passing year, the country as a whole has come to depend on the wisdom and advice of one man who has no ulterior motives, but who simply has an insight into the internal mechanisms of a complicated, contradictory, and unpredictable economic system. And if we are to follow his advice regarding current times, we will find ourselves conserving our money, making cautious and safer investments, and using these less-than-ideal times to better brace our own financial foundations so that each of us emerges stronger and smarter. It is with this advice the American economy will not only survive these uncertain times, but will flourish once it has emerged a better and stronger system. And if there is anything consistent in this man’s messages over the years, this would be it.
