Pollyanna predicts: National outlook strong for 2002.

Let's go back to this paper's third quarter review that came out Oct. 17, a little over a month after the terrorist attacks on this country. We were still literally waiting for the dust to settle. At that time, I wrote that in the past, I had always been a Pollyanna, believing and predicting that things will be better and that there's still a lot to be glad about. I declared that I would continue.

Even in those terrible times, there were good things: The country rallied and came together. We fought back, successfully. We redefined our heroes: Finding shining gold in the simple and sincere bravery of the ordinary people who were placed in circumstances beyond which no one ever imagined and behaved in such extraordinary ways. They made us proud to be Americans...

However, business took a beating; the slight downturn became a recession -- gloom and doom were prevalent. And I, I remained Pollyanna: Repeated that things would get better and that Christmas would be good, not great. Then I held my breath.

Guess what? By George, I was right! And no one could be more grateful than I. Christmas was good. Retail sales were up over last year's. It was a different market than last year, with discount stores gaining 5% in December. Department and specialty stores didn't do well. Book sales "surged", smaller publishers benefiting more than the larger houses. Luxury retail, as a whole, suffered. However, Tiffany's seasonal sales fell only 2%, even though the Fifth Avenue store was hard hit, because of the drop in tourism. Healthy high-end sales of merchandise $10,000 and more is a sign, said Tiffany, that the recession isn't hitting the wealthy as hard as regular folk. With this in mind, one can suppose that the decline in luxury sales will soon end.

Also, the manufacturing sector has been in recession since August 2000, but factory sales for non-military goods rose for the second month in a row in November, an indication of the beginning of an upswing.

People have started going out again. The streets are crowded, even in the cold. Last month, sales in bars and restaurants posted healthy gains.

According to the New York Times, the signs of resilience in retail sales have shored up investor confidence in an economic rebound and overshadowed worries about sliding corporate profits. The retail sales have given an early indication that the economy is stronger. All the above and many others are signals that, nationally, "things will be better".

The economic outlook for New York City is tougher, but certainly more hopeful than hopeless. As reported in the Wall Street Journal: Fundamentally, the city's economic base is strong and diverse. But from an employment perspective, it has been set back by the Sept. 11 attacks and general economics. The city may have lost as many as 100,000 jobs, largely in the securities industry and related financial services. Many may not be restored.

However, many companies that have shifted jobs to neighboring states most likely haven't abandoned Manhattan permanently. It is believed that employers will return to the city, if they are offered tax incentives among other things to do so.

Another issue is how rapidly the city's transportation network is rebuilt and the transportation infrastructure is returning more quickly than people expected. Campaigns to bring back tourism to the city are proving successful.

The consensus of opinion is that the city's economic improvement depends on how fast the city and state can bring back the financial services jobs that were relocated and that the city must broaden its economic base beyond the financial services market, so that it won't be so dependent on a single industry in the future.

I am a Pollyanna whose name is Faith, and I have faith that this will and can be accomplished. We have just begun.