The Midstate economy has shown promising signs of recovery heading into 2013, but regulatory and policy-making uncertainty on the national stage continue to hinder sustained economic growth and threaten to reverse any economic momentum gained since the peak of the recession.

Greg Gonzales, commissioner of the Tennessee Department of Financial Institutions, delivers the keynote address during the 2012 MTSU Economic Outlook Conference Sept. 21. (MTSU photo by Andy Heidt)

Those were among the insights offered during the annual MTSU Economic Outlook Conference Sept. 21 inside the Embassy Suites Hotel and Conference Center.

About 200 business and community leaders turned out to hear featured speakers address topics ranging from the importance of community banking to the prospects of the nation falling off the “fiscal cliff” because of political gridlock in Washington.

During his speech focused on community banks, Greg Gonzales, commissioner of financial institutions for the state of Tennessee, pointed to the rapid consolidation of banks nationally — four large banks control 40 percent of the assets — as a potential threat if the consolidation trend continues.

Dr. David Penn

Gonzales said it’s important that federal and state regulators “not impose a once-size-fits-all model of supervision” on banks and instead strike a proper balance between ensuring banks follow financially sound practices and allowing banking officials to make business decisions that help foster small business growth.

During his presentation, Dr. David Penn, director of the MTSU Business and Economic Research Center, pointed to a significantly improving housing market overall for the Nashville metropolitan area. Single-family housing construction is up 41 percent, he said, and home sales are up 27 percent from a year ago.

“Housing is the brightest spot in the Nashville market right now,” Penn said. “If I’ve said that at all, it hasn’t been since 2005.”

But he tempered that development with concern over a rising unemployment rate in recent months and several other key economic indicators that have either stagnated or headed in the wrong direction.

Donald Ratajczak, nationally known economist and regent’s professor of economics emeritus at Georgia State University, gave a lunch-time presentation that pointed to five areas of uncertainty that could affect the national and global economy:

• the future of the euro.
• whether U.S. political leaders will address the coming “fiscal cliff” of tax breaks expiring and automatic deep spending cuts looming at year’s end.
• China’s economic slowdown.
• the drought’s impact on food prices.
• an unbalanced U.S. fiscal policy of heavy Federal Reserve intervention and little to no action on the federal debt.

MTSU alumnus J.B. Baker, owner of Sprint Logistics and chairman of the board for trucking company Volunteer Express Inc. and Associated Companies, was presented with the Jennings A. Jones Champion of Free Enterprise Award.

MTSU College of Business Dean Dr. Jim Burton, left, presents the Jennings A. Jones Champion of Free Enterprise Award to J.B. Baker, an MTSU alumnus and owner of Sprint Logistics, during the 2012 MTSU Economic Outlook Conference at Embassy Suites Murfreesboro Sept. 21. Baker also is chairman of the board of Volunteer Express. (MTSU photo by Andy Heidt)

In introducing Baker, Burton noted that Baker took the reins at Volunteer Express from his mentor, former Gov. Ned Ray McWherter, a past recipient of the same Champion of Free Enterprise Award.

The company, whose motto is “Large enough to perform, small enough to care,” now employs 325 employees in 30 locations in Tennessee and across the Northeast. Baker previously won the Pinnacle Award, the highest honor in the trucking industry.

In accepting the award, an emotional Baker noted that it was National Truck Driver Appreciation Week and encouraged the audience to take time to thank the many truck drivers who represent “the everyday working guy.”

Baker observed that free enterprise is an entrepreneurial life that can be a “roller coaster.”

“We see a lot of highs and a lot of rewards, but we also see those days where we wonder where the next day is going to come from,” he said. “Free enterprise goes to a lot of people who may not be sitting here today that need to be saluted as well.”

He also offered the audience some advice: “Do the most important thing you have to do in the first part of the day, and you’ll never have an unproductive day.”

The Jennings A. Jones Chair of Excellence in Free Enterprise, the MTSU Business and Economic Research Center and the Weatherford Chair of Finance co-sponsored the event.