Outlook ’88 : How New Year Looks to Area Business Leaders

BERNARD JACOBY

General manager, Hotel Meridien, Newport Beach

In my opinion, there is no doubt that inflation should pick up. And in our industry we like that. It actually helps because when inflation comes, our rates can start rising. I don’t think it will be a year of slowdown at all. Tourism is going to pick up, especially from Europeans. We’ve got a tremendous amount of reservations from Europe because the value of the dollar is so favorable for them.

FRED D. ANDERSON

Vice president, MAI Basic Four, Tustin

We still see no signs of a recession as far as our business. We’re optimistic that the economy is going to continue strongly, albeit at a possibly slower growth rate than in 1987. The weaker dollar will certainly help businesses that are going to export, and I would see the dollar continuing to weaken.

JAMES EDWARDS

President, Edwards Cinemas, Newport Beach

I’m a product of the Depression of 1929, ’30 and ’31. I’ve been trying to operate like another depression was going to come and I’d be ready for it. . . . There’s not going to be another depression. Every year you hear people say that a depression’s coming. 1988 is going to be a good year.

DAVID BLACKFORD

President, Far West Savings, Newport Beach

We’re working on a recession mentality. In other words, we’re not sure there is going to be a recession, but we want to protect ourselves in the event of a recession. It’s what you might call a cautious route. We’re primarily a California real-estate lender, and California real-estate values should remain stable, so we’re not overly concerned about real estate, and we feel good about Southern California.

BILL SNYDER

Director, Anaheim Visitor and Convention Bureau

We’re looking to have a good year, one that will be slightly better than 1987. But we’ll have to work harder to have it. We’re looking for slight growth of 1 to 3%, maybe 4%, in the number of visitors to Orange County, but we realize we have to work harder to get that accomplished. In 1988, there’s more competition and an uncertain economy.

WAYNE SCHROEDER

President, United Western Medical Centers, Santa Ana

Competition will be the main concern of all health-care providers in 1988. The Oct. 19 “black Monday” in the stock market, which was an unforeseen problem for national health chains, will accelerate the trend to size-down and decentralize. To shift from a provider’s market to a purchaser’s market. 1988 will see in Orange County the conversion of acute-care hospital beds to other services. And it will bring the strong possibility that some hospitals will close or suffer financial hardships.

CARMELO SANTORO

Chief executive officer, Silicon Systems, Tustin

This is going to be a very difficult time to manage through. I’m sitting back, thinking that predictable recessions never happen, or never have. It’s the unpredictable ones that get you. This one is going to be unpredictable if it occurs in terms of time. And when it happens, it’s going to come on very rapidly, and I don’t want to be running full speed with blinders on and go running into a glass wall.

SUE GRAHAM

General manager, Bullock’s South Coast Plaza

I believe that what you think or project is what you get. And I’m thinking positive things and projecting a good year. And we’re going in ready for anything. If the economy is good, then we’ll be fine, and if it isn’t, then we’ll be ready to meet what the customers want.

ROBERT DUNHAM

President, Newport Economics Group, Newport Beach

1988 is probably going to be basically a good year, but there are some very high risks involved. We’re getting to the point where we’re not terribly far away from a recession. It becomes sort of a technicality. We’re not forecasting a recession. I do think the overall growth rate will slow a little bit nationally.

JIM CHARTER

General manager, Brea Mall

I think that business in 1988 should be as good as in 1987. Maybe even better. I think (consumers) are going to be more selective and more particular. . . . But I don’t have a paranoia on sales. I don’t see any big spectacular year. But I think with inflation that’s in check and a lot of other things going on, it should be a reasonably good year.

JAMES GIRALDIN

President, Irvine City Savings

There are two major problems with the economy today: the trade deficit and the budget deficit. I think the trade deficit will cure itself with the lower value of the dollar. And I think the budget deficit has to be cut by Congress. I think there will be volatility in all the markets--the stock market, the bond market, the overseas markets--as long as these “twin deficits” remain. We think now’s the time to retrench. To pull your horns in. 1988’s not going to be an easy year. It’s this institution’s position to protect itself now. We’ve done that first by cutting our general administrative expenses, our staff levels, to handle much smaller volumes. And we’ve built our liquidity up.

DOUGLAS HUNT

President, Systonetics, Fullerton

The demand for products in our industry has increased and will continue increasing. Even if the broader economy doesn’t do so well, we still expect a good year.

R. D. HUBBARD

Chairman, AFG Industries, Irvine

Based on the strength of the flat-glass industry and input from our customers, I believe that 1988 will be a very good year.

HENRY SCHIELEIN

General manager, Ritz-Carlton Hotel, Laguna Niguel

I’m very optimistic. We all are too much concerned with Wall Street’s problems because of what happened Oct. 19. But really, productivity and everything else is quite healthy. Besides, I think that being an election year will help the economy. It’s not going to be an easy year, I didn’t mean that. But it’s definitely not going to be a bad year.

WAYNE MILLER

President, Orange National Bank, Orange

We approach 1988 with a great deal of enthusiasm for a good year for us and for business in general in our area. I say that because our area here is diverse. Real estate appears to be strong. And technology and all the service industries and support groups are strong. Our understanding of the interest rate forecasts is that they’re going to be stable. . . . And that there is nothing that will hurt real estate.

GERALD McQUARRIE

Chief executive officer, Downey Savings, Costa Mesa

I feel that oil prices are going to stay down, and inflation is going to stay down, and that we’ve gone through one of the worst times for the stock market that we’ve ever had, and we’ve survived. And most people I know are still convinced that their own stocks are very good, because they’re trying to buy stock back. I’m doing the same thing myself. I think that the intrinsic values are still there, especially in real estate. You take Orange County as a prime example of where everyone wants to live. And these people are going to continue to want to live here. And I see nothing but continued desire to live here and continued prosperity--maybe not in the great big leaps we’ve had in the past, but at a healthy growth.

JOHN REHFELD

Vice president and general manager, Toshiba America Information Products, Irvine

We feel very strongly about the microcomputer market next year. We believe it will grow in excess of 20%. And the growth over the last five years has only been about 15%. It will grow because of some basic, new technology that has resulted in greatly increased user benefits. There’s such strong productivity benefits from microcomputers, and there are things happening that are opening up whole new applications. We’re seeing new stuff that has such an incredible payoff that you’d have to have a very major recession before you’d have significant cutbacks.