Page 7 - UTILITIES DEC 23,2015
P. 7
BUSINESS A25
Wednesday 23 December
STREET BRIEFS Local Business:
AP: Express Scripts How Fed’s low rates have benefited Denver and Colorado
outlook for 2016
J. BOAK Denver stood to capitalize have risen 2.9 percent to that the first Fed hike was
sends shares flying N. RICCARDI on historically low borrow- $27.11 — with both the in- unlikely to change invest-
Associated Press ing rates. crease and the hourly pay ments around Denver.
ST. LOUIS (AP) — Express DENVER (AP) — Since the “This would’ve happened eclipsing the national aver- “It’s not going to affect any
Scripts is projecting 2016 Federal Reserve slashed almost anywhere in the ages. project on the books or any
earnings that surpass Wall rates to record lows seven country if these other in- Home prices and house- proposed ones,” said Nor-
Street expectations, send- years ago, few parts of the gredients were there,” said hold incomes are higher man Franke, regional presi-
ing shares of the nation’s country have thrived as Richard Wobbekind, an than before the Great Re- dent of Colorado-based
largest pharmacy benefits much as Denver. You can economist at the University cession, even as the coun- Alpine Bank.
manager sharply higher see it when customers at of Colorado. “These posi- try as whole, 6½ years into Alpine opened its first two
before the opening bell. the restaurant Stoic & Gen-
The St. Louis company said uine order the “Tower of Restaurateur Jen Jasinski sits for an interview with The Associated Press, inside Rioja, one of
Tuesday that it expects ad- Power,” a $200 tray of oys- Jasinski’s successful restaurants, in downtown Denver, Colo. Jasinski says she’s not worried
justed earnings next year ters, lobster and caviar. about the Fed’s rate hike tamping down Denver’s red-hot economy. “Things are being built,
to range between $6.08 Stoic & Genuine opened in people are moving here, you can see cranes all around,” she said. (AP Photo/Brennan Linsley)
and $6.28 per share. Fact- a redeveloped 19th centu-
Set says the low end of that ry train station a year ago, tive elements enabled peo- the recovery, has yet to Denver branches two years
range is three cents better the third restaurant estab- ple to benefit from tremen- match home prices or ago after decades of serv-
than the average analyst lished by chef Jen Jasinski. dously low interest rates.” earnings enjoyed before ing more rural communi-
forecast. Companies like It’s earning far more than Other sections of the coun- the recession. ties in western Colorado,
Express Scripts run prescrip- Jasinski and her partners try prospered far less or not Young college graduates drawn to the area by its ro-
tion drug coverage for in- expected, a sign of the at all. The Fed’s efforts to in- are migrating en masse to bust growth. The bank has
surers and large employ- bounce enjoyed by Den- ject cash into the economy Denver. Nearly 52 percent been involved in $80 million
ers. Express Scripts Holding ver-area workers, entrepre- weren’t enough, for exam- of Denver’s 25- to 34-year- inbusiness loans since then.
Co. provides coverage for neurs and homeowners. ple, to spare Florida from olds have graduated from “It’s amazing,” Franke said
more than 80 million peo- The Fed’s near-zero rates a wave of foreclosures, to college, up from 43.4 per- of the Denver area econo-
ple and has been a fre- played to Colorado’s ad- reinvent the battered in- cent in 2009. Nationwide, my, noting that United Air-
quent critic of soaring drug vantages: An educated dustrial Midwest or even less than a third of Ameri- lines recently announced
costs. The company has population, growing tech to raise most people’s pay cans in that age group that it will open a pilot train-
used its massive customer firms, energy reserves and very much. have finished college. ing center in the region.
base as leverage to help a real estate market that What’s more, many Ameri- Around the country and “It’s diversified. It’s great to
reign in the price of certain never really succumbed to cans couldn’t qualify for the world, the prospect of see.” Car and truck sales,
drugs.q the ravages of the housing the low mortgage rates a Fed rate hike had stirred too, surged more in Colo-
crisis. Ultra-low rates made made possible by the Fed. varying degrees of anxiety. rado than in the rest of the
U.S. economy grew it easier to borrow, invest And workers with no more Some analysts still fear that country. That meant that
at 2 percent annual and prosper. than a high school degree a steady rise in the Fed’s Rocky Mountain drivers
rate in third quarter “Things are being built, peo- have been increasingly benchmark rate could benefited more from ultra-
ple are moving here — you pushed to the sidelines of cause the dollar’s value to low-rate auto loans, a dis-
WASHINGTON (AP) — The can see cranes all around,” the job market. increase further. This would count that’s likely to dimin-
U.S. economy grew at a Jasinski said, sitting in the But the numbers tell a differ- likely depress exports and ish only slightly as a result of
slightly slower pace over back of her bustling flag- ent story in Colorado and the profits of multinational the Fed rate hike.
the summer than the gov- ship restaurant, Rioja. its capital of Denver, where companies. Between 2010 and 2014,
ernment had previously es- And though the Fed on the conditions existed for Others worry that high-yield auto registrations for new
timated. Most economists Wednesday began raising exploiting the benefits of junk bonds could collapse, vehicles soared 82 percent
foresee a slight accelera- rates for the first time in nine record-low rates. along with the debt of in Colorado. Nationally,
tion in the current quarter years, it’s hard to find any- Colorado’s unemployment emerging economies. by contrast, the increase
and stronger growth in the one who fears that Colo- rate is now 3.8 percent, ver- But Coloradans who were was 57.6 percent, said Tim
first half of 2016. The Com- rado’s economy will suffer. sus 5 percent nationwide. asked about modestly Jackson, president of Colo-
merce Department says For one thing, the Fed’s rate Over the past 12 months, higher U.S. rates sounded rado Automobile Dealers
the economy, as mea- increases will likely be slight average hourly earnings blasé. Many suggested Association.q
sured by the gross domes- and gradual. For another,
tic product, expanded at the ultra-low borrowing
a 2 percent annual rate in rates the Fed engineered
the July-September quar- strengthened a regional
ter. That was a bit lower economy that was already
than its previous estimate blessed with healthy funda-
of 2.1 percent, a result of mentals.
less restocking by busi- In a country where the
nesses than previously sources of prosperity are
estimated. Last quarter’s spread unevenly, Denver
expansion was significant- provides one piece of a les-
ly below the 3.9 percent son about the possibilities
annual GDP growth in the and limitations of the Fed’s
second quarter. The slow- efforts to revive the U.S.
down reflected a cutback economy after the 2008 fi-
in the pace of inventory re- nancial crisis.
stocking. Economists think With its high education
growth in the final quarter levels and infrastructure in-
will amount to around a 2.2 vestments — and even the
percent rate, helped by cachet of newly legalized
solid consumer spending.q recreational marijuana —
