LAS VEGAS (KLAS) — There is growing uncertainty following a volatile few days on Wall Street. The Dow Industrial Jones Average closed up 99 points Thursday regaining some ground a day after the market plummeted 800 points — setting off a recession warning.
So how likely is a recession? And could Southern Nevada be impacted?
While some say the big drop means a recession could be coming, local experts tell 8 News NOW they’re actually not that concerned.
“I don’t see any sign of a recession,” said Stephen Miller, director, UNLV Center for Business and Economic Research.
Miller, an economics professor and researcher says the Dow’s recent plunge is the result of an overreaction from investors. He says they’re afraid of slow growth in the global economy and the uncertainties surrounding the U.S.’s trade war with China.
While some fear a repeat of the Great Recession from the late 2000s, Miller says, not so fast.
“I think that things are different right now,” he said.
Miller says the Great Recession was caused by the housing market collapse and high unemployment. But those economic indicators — at least in the Las Vegas valley — are nowhere to be seen.
“We’re down now to single digits in terms of people underwater on their mortgages,” Miller said. “The unemployment rate in Las Vegas is down, around the 4 % level.”
“The effects of the recent drop, I don’t anticipate being that bad,” said Dana Berggren, commercial real estate broker.
During the Great Recession property values were down and many commercial developments went into foreclosure. But now more secure measures are in place to prevent any drastic changes.
“It was really difficult to get capital, it was really difficult to find credit from banks, and now, it’s not as difficult. It’s just that the banks are scrutinizing people more closely, so I feel more secure in that,” Berggren said. “Everybody has been a lot more conservative in their business dealings.”
Still Miller says if higher tariffs are imposed on Chinese goods a recession could still be possible.
“As far as I can tell, things look pretty good for the U.S. economy, at least in the short run. If you go out two years, then things could change.”
Miller says it’s unclear what will happen next because it’s hard to predict what exactly the Trump administration will do in terms of those tariffs.