Costs Are Going Up Because The Economy is So Good

When I was in California a couple of weeks ago I was on a panel.  They always ask you to predict something.  I chose two things:

1. Because I was in California and I assumed people out there didn’t like Trump, so therefore had a negative bias on any news I said that the economy was doing very well and that we were not headed for a recession.
2. I predicted the IPO pace would go way up, because the cost of capital was going to go up in the private market and that with a stronger stock market, companies would want to cash in.

A few of my fellow panelists though that the IPO train would slow because of the volume of private money  out there.  There is a lot of it for sure and we will see.  With Lyft setting the tone, a lot of companies are looking at their last valuation and seeing if it will measure up.

News today says most Americans believe the economy is doing well.  At CNN no less.

Anecdotally I am seeing a lot of signs of growth in certain cities when I travel. Talking to entrepreneurs who run companies I am hearing that the job market is very tight.  It’s costing more to hire employees because they can find new jobs.

Of course, in my short walk down Clark St from Fullerton to Diversey last night, I saw shuttered business after shuttered business.  You can see how some people might get a bad read on the rest of the country living in their own microcosm.  That’s not the economy, but local policy.