Food for thought at Pike Chamber economic event

Prominent analyst says basic US economy is strong By Marilyn Rosenthal SKYTOP — Joseph V. Battipaglia, often referred to as “the Bull of Wall Street” was the featured speaker at the Pike County Chamber of Commerce’s annual Signature Event, held at Skytop Lodge on Sept. 18. Joe Battipaglia is the chief investment officer of Washington Crossing Advisors and the market strategist for the private client group of Stifel Nicolaus. He has held various executive positions in the financial world for more than 18 years. He graduated Phi Beta Kappa in economics from Boston College and then earned his MBA at the venerable Wharton School of Business, University of Pennsylvania. Battipaglia is frequently featured by the national media including CNBC, FOX News and Nightly Business Report. His market views are often quoted by The New York Times and the Wall Street Journal, as well as other financial publications. One of the most interesting things about the evening was that this gentle giant of a man stood in front of a group of people, many of whom are bank presidents and vice presidents, real estate people, financial advisors and investors, and spoke in a conversational style, without any notes, but with an amazing array of facts and figures completely at his fingertips. He was so at ease and well informed that he made listeners feel almost as if he were having a little talk with them in the living room. Even those listeners who were not steeped in finance and economics, were able to come away with a better understanding of our current market situation, how we got there, and where we might end up. Battipaglia talked about how 9/11 changed everything in the economic landscape. He mentioned that easy money and speculation caused the mortgage crisis we are seeing today. He joked about “NINJA loans — No Insurance, No Job, No Assets — Here’s a loan.” But he wasn’t joking when he said that before this debacle, there was 50 cents of debt for every dollar of equity. Now, we have $1.40 of debt to every dollar of equity. And he wasn’t joking when he pointed out that with the government takeover of Fanny (Mae) and Freddie (Mac), 80% of mortgages have now been “nationalized.” Not only that, but with the bailout of AIG, the “Feds” are now getting into the insurance market, as well. He said, “When the government takes over, it creates its own inflation. The price you pay is higher regulation and inefficiency.” Battipaglia urged calmness, not panic. He said that this situation is not something that occurred in a day, and it can’t be solved in a week. He felt that the current “ad hoc” approach we are now seeing, in itself, creates market volatility. As to where we are going, he predicts that the housing market will take years to come back and we will first begin to anticipate good things in about 2010. But there is light at the end of the tunnel. Basically he feels that the American economy is strong and we will survive. The turnout was as impressive as the fine Skytop food and the timeliness and impact of the topic couldn’t have been more timely. The Gold Sponsor of the evening was Pennstar Bank and the Silver Sponsors were Biondo Investment Advisors, Dime Bank, Ed Nikles Custom Builder, Pike County Light & Power, Pocono Medical Center, and Wayne Bank.