#197: Forecasting the Recovery & Cutting Through the Noise with ITR Economics

Today we’re going to be talking to Alex Chausovsky from ITR Economics, which is a world-renown Economist forecasting and consulting company which works with some of the top mid-market companies and is heavily involved in nationwide CEO Peer Groups like Vistage using their data.

A year and a half ago I had him on the show to discuss their short and long -term economic forecast. One of ITR Economics’ main theses has been a slight downturn in the early 2020’s and then a great depression in 2030.

Since I had him on, we’ve had a worldwide pandemic that has decimated our global economy. A lot of the things we discussed in the first interview like the demographic shifts and some of the variables that go into their 2030 great depression forecast are still relevant. I figured it was time to get him back on the show to explain how our current situation impacts their forecasts and what they think the future holds.

 In today’s episode because you’ll learn –

• About Alex Chausovsky and his background
• The leading indicators to track and measure the health of the economy
• How deep and how long the economic pain will be
• Will experience a V-shaped or U-shaped recovery?
• The implications of the Federal Reserve printing money
• How corporate and consumer debt affects the recovery period
• ITR Economics forecast for the rest of 2020/21
• How the pandemic impacts ITR’s 2030 prediction
• What ITR’s forecast is on the job recovery
• The 90% economy
• How are new normal is impacting valuations
• Their forecast on unemployment in 2021
• What companies can be doing right now to weather the storm and set themselves up for the long term
• How to view rates of change
• What ITR is using to predict how the virus is
• Alex’s view on the potential to have inflation
• How consumer’s behavior will impact our recovery 

Main takeaway / Why I liked the episode –

One of the best things you can be doing is figuring out how to build that bridge between now and the future, over the course of the next 18 months. That all starts with education. There are two ways we hope to help you get clear, get intentional, and get going:

  1.)    Mastering Your Cash Flow – Video Series

1. How To Build A 13-Week Cash Flow Statement

Get clarity on where and how your cash is coming from and being used and then build a plan to manage it wisely. Learn how to build a 13-week cash flow statement from the top CFOs in the marketplace.

1. How to Build And Revise Your 2020/21 Budget And Forecast

2020 and 2021 are most likely not going to look like you thought they did back when you built your budget and forecast. Learn how to model out different scenarios using forecasting best practices.

1. c. Create A Strategic Plan to Grow Company Value

Increase the chances you come out of the gates and capitalize on the future opportunities when our new "normal" sets in. Start thinking about how you can create a strategic plan to grow a valuable business that gives you choices.

 2.)    Intentional Growth™ Digital Course

Because of the current situation, Pat and I are working on a digital video course on the Intentional Growth™ 5 Principles. It will be the best of our material that we have in our 2-day Boot Camps that normally costs 5k for $295. Text the word Intentional to 66866 to get on the waiting list of the digital course.

We’ll teach you how to build a valuable company with the end in mind using our 5 Intentional Growth™.

1. In principle #2 - You’ll learn everything about how companies are valued, deal structures and how to calculate net proceeds (this helps if you want to know how much your company is worth, looking to buy a company or eventually want to sell)
2. In principle #3 - You’ll learn how the 5 major exit options (Internal, ESOPs, PE and more) work & the implications of each
3. Principle #4 - you’ll learn how to increase your multiple by de-risking your company and building value for the long-term build a financial model that ties to your strategic plan and what it takes to grow value for the long term.

 About Alex –

Alex Chausovsky is an accomplished Speaker and the Director of Speaking Services at ITR Economics. He is a highly experienced market researcher and analyst with more than a decade of expertise in subjects that include macroeconomics, industrial manufacturing, automation,and advanced technology trends. He has consulted and advised companies throughout the U.S., Europe, Brazil, China and Japan for the last fifteen years and has been featured on NPR, the BBC, and in the Wall Street Journal. His extensive consulting expertise is greatly valued by management teams of companies both large and small. ITR Economics’ clients rely on his input when developing strategic plans for the future, as he helps them plan for risk conditions and find areas of opportunity.

Quotes:

12:16 – “We had been expecting a slowdown in the US economic cycle the last time we discussed this.” – Alex Chausovsky

21:00 – “Clamp the wound before you can start addressing the patient, so that is sensible. But it does play into this concern that we’ve had for a very long time. The ability to live beyond your means is not sustainable, long term.” – Alex Chausovsky

21:52 – “The question is not so much, ‘How much debt is there?’ but ‘Does the world have an ability to continue to put faith in the US government from repaying the debts that they have?’” – Alex Chausovsky

27:34 – “There will be a day of reckoning and what that day looks like--it’s not a pretty sight.” – Alex Chausovsky

49:25 - “It comes down to faith but also your ability to pay your debts. What would make people lose their faith in [the United States] is if we’re not paying out debts to other countries, essentially.” - Ryan Tansom

Resources/Links:

LAB Episode 120: 10 Year Economic Forecast, 2019 Downturn, 2030 Depression with Alex Chausovsky

ITR Economics, official website

Alex Chausovsky, Twitter

Alex Chausovsky, LinkedIn

Infinite Game by Simon Sinek

Conscious Capitalism: Liberating the Heroic Spirit of Business by John Mackey

Ray Dalio, Leadership at Bridgewater, Bio

Bridgewater, “Big Debt Crisis,” PDF

“Ray Dalio: We are very late in the long-term debt cycle” (Yahoo video)

Principles by Ray Dalio

Mastering Your Cash Flow Digital Course

ARKONA Boot Camp

Reach out to me if you have questions about the boot camp! You can also reach out to me via email at [email protected], on my LinkedIn, or you can call me at 612-720-6530.