Macro economic and political forces continue to mix together into an usual concoction this summer, making it hard for profitable corporations to get a read on the future and tempt them to pull cash off of the sidelines and into expansion and growth. Recovery from the Great Recession has been anemic
as a result.
Meanwhile, venture capitalists are beginning to make moves right now, signaling the possibility that a meaningful recovery could be ahead. The companies they are backing are mostly technology concepts. Most of these concepts are software or processes that drive more efficiency into everything we do. It’s an encouraging sign, but comes with a twist.
Software and technology of tomorrow will be held in what is dubbed “the cloud.” Instead of our hand-held devices and computers holding the brains of the software application we load and use, a bank of servers and supercomputers held by companies entering this space, such as Amazon.com, will hold them all and effectively beam what we want back and forth to our devices. You won’t know any difference in certain respects.
Your smartphone, iPad or computer, for example, will still have icons on it. But you will be able to do many more things on them because you don’t have to buy a specific application, download it and then perform its function. The cloud will allow you to reach in and pay for only what you use when you use it and literally every application and function in the world will be available to anyone with a hand-held device or personal computer.
Ultimately, the massive amount of technology that can be housed in the cloud and used by businesses and consumers will drive a new wave of efficiency into the American economy that may exceed what Microsoft did for us in the post-recession era of the early 2000s. Venture capitalists are backing the early stage concepts that should be the winners in that space.
The bad news is that, unlike the roughly 24-month jobless recovery period after the last much shorter recession, the efficiencies coming our way through the cloud and new emerging technologies inside it will be so significant that many economists are anticipating the longest jobless recovery in modern history. Dr. Sam Chandan, an economist and adviser to the U.S. Treasury, predicted in May as much as a 48-month recovery without significant job growth.
Housing could see a boost from a healthier lending climate regardless of what happens in the cloud. But buyers need jobs. Housing will continue to see lower transaction volume as any real sustainable demand requires higher employment. This time, higher employment may be further off thanks to something called the cloud.
Tom Hoban is co-owner of Everett-based Coast group of commercial real estate companies. Contact him at tomhoban@coastmgt.com or 425-339-3638.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
