An audience of about 140 listened intently to economic forecaster Kirk Lesh during a presentation last week in Thousand Oaks.

As the U.S. Senate debated the stimulus package for the nation, Lesh, a real estate economist from the UC Santa Barbara Economic Forecast Project, shared his interpretation of the past, present and future economy of Thousand Oaks.

"Never in our history have we ever invested this much capital into our economy—and there's going to be repercussions," he said.

Money is going to shoot through the roof. The nation will hit an inflationary cycle in 12 to 18 months, and the government will then have to figure out how to get that money out of circulation, Lesh said.

How do they get it out of circulation? They burn it electronically. No pollution.

Lesh also explained what happened in the past and where the city is economically today.

The setting was plush. Those attending the 2009 Regional Economic Forecast, presented by the Thousand Oaks-Westlake Village Regional Chamber of Commerce and the Rotary Club of Thousand Oaks on Feb. 6, sat under crystal chandeliers at the Westlake Village Inn, facing the golf greens outside.

Although Thousand Oaks is a well-managed city, Lesh said, challenges lie ahead.

A decline in retail sales in Thousand Oaks—mostly a result of a drop in vehicle sales—exists despite the expansion of The Oaks mall into a "fantastic, premier" shopping center, he said.

The current "huge mess" the city is in, Lesh said, is in large part caused by people who bought homes they couldn't afford.

"Home prices grew faster than our incomes, a situation that had to correct."

Thousand Oaks saw positive job growth in 2006 and 2007, but still observed an increase in home foreclosures.

Now there's a national housing crisis.

"Then Uncle Sam rode in on a pony," Lesh said.

It was imperative to keep the banks propped up, even though people argue about the method employed, he said.

"Lower rates are needed to help prevent foreclosure," he said. But lower mortgage rates aren't going to help everyone.

"Lower rates are not going to help people who are upside down on their loans."

Mortgage companies will not refinance a loan that's larger than the value of the house.

Loan modifications are also difficult to make when a breadwinner has lost a job—adjusting to new mortgage terms is just not going to happen, Lesh said.

The government needs to purchase these loans and get toxic properties off of the banks' books, he said. These properties should go to the housing authorities and become occupied.

Although Lesh said he wishes everyone could own their own homes, it was unrealistic when the country recently had 69 percent homeownership because the percentage of people who can afford a home is lower than that.

He cautioned against nationalization and overregulation of banks.

"For better or worse, we believe in a free market," he said.

Lesh is a lecturer at California State University. He also works on the UC Santa Barbara Economic Forecast Project, which was established in 1981 to provide the community with information on economic, demographic and regional business trends in Santa Barbara, San Luis Obispo and Ventura counties.

"It wasn't all doom and gloom," said Madeline Hess, chair of the Chamber board. "We have a challenge, but we are fortunate to live in Thousand Oaks and Westlake Village."

"It's better here than in other places. We have money and credit available," said past Rotary board member Patrick McCoy.

Not everyone was optimistic. "It scared the life out of me," said Chamber member Marty Morrow.

Past experience, combined with the economic news of today, gave him great concern.

"I've been a lender for 30 years, and I've been through a lot, but this is the worst ever because of the loss of jobs. Jobs are the key," Morrow said.

T.O. economic development manager Gary Wartik said he was optimistic. The banks in the city didn't get involved in making bad loans. Most local businesses have held onto jobs.