SAN DIEGO-As the U.S. economy enters 2012, an "Age of Anxiety" continues to undermine confidence. But one person believes credit unions can capitalize on the uneasiness.
Todd Buchholz, an author, CNBC regular and former White House director of economic policy. said the building blocks of the global economy have "shifted around before our eyes, creating a new era of hyper competition."
The opening of Eastern Europe in 1989, accompanied by the rise of India and China over the last decade-plus, added millions of new workers to the global labor force, he noted. That has led to an increase in commodities prices, an "Occupy" movement that has emerged as a backlash against certain practices, and the threat of trade wars.
But Buchholz said credit unions have an opportunity in such an environment, but must supply "complete solutions." Even if a member says he or she only wants a car loan, for example, the CU must ask about the member's college savings plan, life insurance and other possible products.
"Credit unions need to understand their members, identify their most profitable products and cross-sell," he counseled. "One very important element is to reduce the hassle factors."
Buchholz's other projections for the year ahead:
• Treasury rates will rise to 3.25% by the end of 2012. He said the only reason U.S. GDP has been positive since June 2009 is the Federal Reserve has lowered interest rates.
• There are positive signs of growth. After three years "in the bunker," consumers are tired of not spending money. He said restaurants and hotels are reporting increased income.
• The employment remains muddled. Buchholz said the unemployment rate is just 4.2% for those with a college education, 10% for people with a high school diploma, and "really bad" for those with no diploma. "President Obama's healthcare plan is retarding hiring by placing a tripwire in front of job creation," he declared. "The plan calls for mandatory healthcare for companies that have 50 or more employees, which is affecting the millions of companies with 18 to 49 employees."
