For two years, I’ve had occasion to admire the ability of economists to deliver dire, dour and detrimental news, while keeping an audience not only awake, but laughing.

And I was not disappointed at Vectra Bank’s Economic Forecast breakfast at Cheyenne Mountain Resort.

Keynote speakers were Dr. Tom Zwirlein, professor of finance at the University of Colorado at Colorado Springs and director of the Southern Colorado Economic Forum, and Dr. George Feiger, CEO of Contango Capital Advisors Inc., an affiliate of Zions Bank, Vectra’s parent company.

Zwirlein said that all but three components of the El Paso County Business Conditions Index have improved.

“It’s heartening that maybe we’ve hit the bottom and are starting to trend up,” Zwirlein said.

Unemployment is low in Colorado compared to the nation, but per capita income is only 95 percent of the U.S. average in Colorado Springs.

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“We’ve known this for a long time,” he said, “but at the same time it needs to be a goal to increase our per capita income and bring wealth to our community.”

On the other hand, population growth is expected to be strong in 2010.

“Why? Because we’ll be counting people, again,” Zwirlein said. “We are generally undercounted (in the county) for a long period of time, and then with the census we (catch up). The census is important because (funding depends on it).”

Projections for El Paso County during 2010 include:

2.9 percent population growth

7 percent unemployment rate

2.4 percent increase in average wages and salaries

2 percent increase in retail trade and

25 percent increase in single family housing permits

Feiger said the national economy is recovering but will be volatile for the next decade.

“We will not — for the foreseeable future — go back to the conditions of the last 25 years. And as investors, we’ll have to act very differently,” Feiger said.

Globally, the recession is ending, but the recession was not caused by the housing crisis.

“It was caused by a rapid contraction of available credit to the entire economy — not only ours, but globally,” he said.

“Not because bankers are evil people, — even though I do have twinges from time to time — and not because bankers are vicious, evil and unwashed but because capital was not available,” Feiger said.

Now, as for the national debt, the news is serious.

“We’re in debt up the wazoo,” he said.

Total domestic nonfinancial debt is 250 percent of gross domestic product, and financial debt is 110 percent of GDP.

“That amount is unprecedented and absolutely unsustainable. The implications of 360 percent debt to GDP will color our recovery,” he said.

“The debt bubble, crisis and collapse will have huge implications for consumers.”

The oft-quoted statistic that consumers comprise 70 percent or more of GDP is not “normal.”

“It used to be 60 to 62 percent of GDP. People did something called saving,” Feiger said. “In civilized countries, such as Germany, consumption is 60 to 65 percent of GDP. But we have a mountain of debt that either has to be repaid or defaulted on.”

While the good news is that residential property is affordable, the bad news is that housing prices will continue to fall. The supply of houses for sale is increasing — “not because of no construction, but because foreclosures are increasing and will keep increasing,” Feiger said.

The main reason for foreclosures in the country today is not unemployment — it’s “walk-aways.”

For many years, consumers obtained credit easily and this drove up the price of houses. But now asset prices have fallen — but the debt has not.

“So you’ll look at yourself in the bathroom mirror and ask yourself, ‘well, are you a moron? Why in the world am I paying a $400,000 mortgage on a $200,000 house?’ And so you’ll hand the keys in,” he said.

Although no more than 10 to 15 percent of houses will be “deeply underwater” in 2010, it will be enough to keep the foreclosure market going for years. Many commercial real estate loans are likewise upside down, and corporate America is carrying a higher level of debt than ever in the history of the United States.

“While the economy is starting to recover, there are huge problems that have to be worked out and the legacy of this massive credit bubble will take up to 10 years to be worked out,” Feiger said.

Meanwhile, investors who fancy themselves as conservative need to do three things: Have realistic expectations, create a 36-month rolling liquidity plan, and actively manage near-term portfolio needs and their long-term opportunity portfolio.

“Any money you need in the next three years, you need to invest very cautiously,” Feiger said. “If your kid is 15 — do not under any circumstances put the college money into China.”

Rebecca Tonn covers banking and finance for the Colorado Springs Business Journal.