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Today, a random-access column, beginning with:

Moment in time

If there is anything approaching a silver lining to the impacts of the Great Recession on the North Bay and particularly Sonoma County, it might be this:

For the first time in decades, the conditions exist in the North Bay's most populous county to make it a very attractive and affordable place for business.

Two factors are paramount in Sonoma County. First, home prices. High housing costs have been the Achilles’ heel of Sonoma County, and for the first time in perhaps a decade, homes are affordable and available.

Secondly, the commercial real estate infrastructure that meets the needs of an array of businesses already exists and is plentiful. And, like housing, it is affordable.

Indeed, companies that two years ago most likely would have looked out of state to expand can now find the space they need and can afford right here.

Combine those factors with a relatively high-skill work force, a very strong education infrastructure and world-class quality of life, and suddenly Sonoma County looks like a pretty good place to do business.

As one newly arrived CEO said recently, Sonoma County and the North Bay have a great story to tell. It is, he said, a place that is "lifestyle" centered, offering the kind of work-life balance that appeals to many. That, he said, is a competitive advantage.

Now, if only the world knew about it. Mostly importantly, there is no time to waste. This is a unique moment in time that could easily be gone a year from now.

***

The next bubble

Are we in the process of replacing a private-sector debt bubble with a public one?

Yes, says Christopher Thornberg, an economist who has presented his ideas many times over the years in the North Bay.

"The nation seems to be trading in its private bubble for a public one, swapping one set of unsustainable economic drivers for another," said a recent report by Mr. Thornberg's Los Angeles-based Beacon Economics.

Mr. Thornberg – though painfully – has been right before. He correctly forecast the housing collapse and was an early bear on the economy.

Beacon's March 30 report noted that economic growth has returned, although very slowly. But, the forecast contends, "the rebound is due to unsustainable government policy rather than improving economic fundamentals."

"The imbalances that pushed the nation into recession in the first place have not been corrected, but papered over by government fiscal and monetary policy," Mr. Thornberg said.

"The fear is that we're swapping one set of unsustainable economic drivers for another – trading a private bubble for a public one."

On a positive note, Mr. Thornberg is fairly optimistic for the rest of this year and the beginning of 2011, but says the economy "becomes increasingly precarious by mid-2011 and 2012."

The cause of Mr. Thornberg's concern is the withdrawal of stimulus funds, massive federal borrowing and spending and the very shaky nature of state and local finances.

"The federal government cannot continue to run these massive deficits indefinitely," Mr. Thornberg said. "A best-case scenario is that we manage to draw down the public bubble slowly, meaning the government pulls back on the stimulus slowly, while a worst-case scenario is that the bubble pops rapidly, dipping the economy back into recession."

One can only hope the best-case prevails.

•••

Brad Bollinger is Business Journal editor in chief and associate publisher. He can be reached at 707-521-4251 or bbollinger@busjrnl.com.