COMMERCIAL PRINTING OUTLOOK -- Ambiguity is Certain
BY MARK SMITH
In the realm of economics, there is an important distinction between ambiguity and risk, asserts Andrew Paparozzi, chief economist and vice president of the National Association for Printing Leadership (NAPL) in Paramus, NJ. People can come to terms with risk by first assessing the potential outcomes, then associating probabilities with the most likely results and ultimately deciding if the risk is worth taking. "With ambiguity, or uncertainty, you don't know what is likely to happen so you can't really assign probabilities to the different possible outcomes," Paparozzi explains. "That's a very different, and much more damaging, environment for the economy. Unfortunately, right now we're facing a lot of ambiguity."
"Ambiguous" is a very good adjective to capsulize the outlook for the economy in general and the commercial printing sector in particular. There already were scant few certainties in the printing business before the recent economic, and geopolitical, shocks—9/11, the war on terrorism, confronting Iraq, corporate accounting scandals and even continued fallout from the dotcom boom/bust.
These short-term challenges have diverted attention away from the more fundamental issue of the outlook for print as a communication medium. For that reason, and others lurking below the surface, there's a taint of bad news even in the good news for 2003.
"At this point in time, it looks like the 2003 economy should perform close to the long-term trend of real (or inflation adjusted) GDP growth of around 3 to 3.5 percent," says Ronnie H. Davis, Ph.D., chief economist at Printing Industries of America (PIA) in Alexandria, VA. In support of this positive outlook, Davis cites the generally favorable expectations for inflation, labor markets and interest rates in the coming year.
However, the economist cautions that a "double-dip" recession could materialize if the long anticipated stock market rebound does not take place and consumer and business confidence falls.