A few months back, Smith believed the economy was poised for a breakthrough. Rents were soaring, as were used car prices -- both signs of pent-up demand -- and that presaged a simultaneous boom in new car sales and apartment development. It didn't quite sync up.
"What I think I missed was how fast multi-family housing would be able to ramp up," Smith admits. "it was at a much gentler pace than I thought ... So that's been delayed. We've seen maybe a 60 or 70 percent rise, but we're not back to the level we were before the crisis despite the huge number of renters we have."
But to really make the transition from slow to rapid growth, many economic waves have to crest simultaneously.
"There's a big difference between them all hitting at once, and them playing out over time," Smith says. "When they all happen at once, it kind of kickstarts the whole economy, you put on more demand to service all those people -- there's just a big kick that happens in the economy. If it all happens slowly, it could dribble out."
Outside forces didn't help. State and local government worker layoffs continued, the crisis in Europe re-emerged, and Fed officials signaled weak commitment to fostering the recovery.
"As things started to pick up in the beginning of the year, [Fed officials] started talking about how they may have to raise rates earlier," Smith said. "That did give a sense to people in the financial markets that credit could really start tightening. That could be part of the reason why housing and apartments had a harder time finding financing. I don't think everything was going to be great if that hadn't happened, but they contributed another headwind. It was shockingly unhelpful."
Absent some new catalyst, Smith says it's hard to imagine the economy will jumpstart itself.
"The European situation is only going to be a headwind in the opposite direction, so we'd need a bigger kick."
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