Newspaper article THE JOURNAL RECORD

Texas Headlines Project Sense of Dreary Familiarity / Economic Picture Complicated

Newspaper article THE JOURNAL RECORD

Texas Headlines Project Sense of Dreary Familiarity / Economic Picture Complicated

Article excerpt

HOUSTON - Like uninvited guests who decide to extend their stay, the headlines throughout Texas have projected a sense of dreary familiarity the past week.

Although there was a familiar ring to the bad news, most conspicuously the woes of the First Republicbank Corp. of Dallas, many economists interpreted it as part of a new and more complicated economic picture that the state has seen for for the last several years: financial debacles at the same time of moderate economic growth.

``I've been telling people that 1988 is going to be a year of modest economic recovery and horrible economic news,'' said M. Ray Perryman, director of the Baylor University Forecasting Service.

``We're going to see a continuing stream of bad economic news, but at the same time underneath all this rubble is an economy that's growing.''

The chaos on the surface is still easier to see than the signs of life beneath it.

In the past week alone, Houston news was dominated by a continuing budget crisis at City Hall that left the city facing a $14 million budget shortage this year and a projected $42 million shortage for the next. There were more foreclosures on high-profile downtown real estate in Austin, one of the nation's most troubled real estate markets.

The debacle involving First Republic, the state's largest banking corporation, reverberated throughout the state. The Federal Deposit Insurance Corp. announced it would inject $1 billion to shore up the bank corporation in an interim rescue attempt.

Experts said the problems, particularly those in banking and real estate, were more a reflection of fallout from speculative excesses and inflated expectations in the past than of any current economic deterioration.

``What's happening now is a residue of what happened from 1982 to 1986 when Texas kept building as the economic base was contracting,'' Perryman said. …

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