Bank leader bullish on economy

Some U.S. investors have declared the economy in a slowdown and in a recession.

These naysayers see high energy costs, threatened job security and continued deficit problems.

Jack Guynn sees things differently.

"Today, the U.S. economy is doing quite well, even better than many people allow themselves to think," said Mr. Guynn, the president and CEO of the Federal Reserve Bank of Atlanta.

Mr. Guynn spent Thursday's lunch hour speaking to about 150 members and friends of the Augusta Exchange Club at the Richmond County fairgrounds.

Virtually all of Augusta's banking leaders attended the speech to hear Mr. Guynn's forecast.

After all, he is one of 19 people who sit on the Federal Open Market Committee - the nation's chief monetary policymaking group.

Mr. Guynn provides input regularly for Federal Reserve Chairman Alan Greenspan and will likely be advising Augusta-born Ben Bernanke next month, provided Mr. Bernanke is successfully confirmed for the chief spot.

Despite what others might say, Mr. Guynn told the crowd to prepare for a good year.

"I think the outlook remains quite favorable for 2006," he said. "And I expect we'll enjoy a solid economic expansion for the third straight year."

Though high energy costs are affecting business, companies are still hiring, he said.

"Indeed, labor markets are stronger now than last year," he said, adding that in 2005 about 2 million new jobs were added.

Though the apparel, automobile and airline industries suffered job losses, Mr. Guynn said, he has heard of shortages of skilled workers in industries such as construction.

Mr. Guynn, who has served 10 years as president, said the country has encountered its share of "economic setbacks" in the past decade.

"But after each blow - no matter how nasty or surprising - our economy recovered and recovered quickly," he said.

"I believe one of the important lessons that has been reinforced is that monetary policy that is focused on low and stable inflation helps our economy remain resilient and strong."

With his positive outlook, Mr. Guynn did provide a warning to develop sustainable energy policies, to build a competitive work force and to deal with the nation's deficit.

"Crises do not often lead to good long-term economic policies," he said. "So let's do the right thing for future generations and act now when our economy is strong."

Reach Tony Lombardo at (706) 823-3227 or tony.lombardo@augustachronicle.com.