7:24 PM

The Audacity of (Economic) Change

Posted by Skye |

Let's all get serious: The U.S. may be the richest country on earth, but the economy is tanking - That is the opinion of many, so it must be right...RIGHT??

Recession? Not So Fast, Say Some

A funny thing happened to the economy on its way to recession: It's taken a detour.

That, at least, is the view of a growing number of economists --including some who not long ago were saying a recession was all but inevitable. They note that stock and credit markets have steadily improved since the Federal Reserve intervened to keep Bear Stearns Cos. from bankruptcy in early March, while a series of economic reports have been stronger than expected.


• The News: Retail sales, excluding autos and parts, were surprisingly firm in April.

• The Upshot: Consumer spending and the U.S. economy continue to grow, suggesting recession is not a foregone conclusion.

• The Risks: It could be that the data will worsen in coming months, raising the risk of a shallow but lengthy recession. Economists also cite swift policy responses, including a sharp reduction in interest rates by the Fed-- to 2% from 5.25% last September -- and the distribution of fiscal-stimulus checks to millions of Americans, as factors possibly easing the downturn.

"A couple months ago it seemed like we were on the abyss," said JayBryson, global economist with Wachovia Corp., referring to the seizing up of credit markets and the collapse of Bear Stearns. "Things have changed....The numbers we've seen recently haven't been as bad as we were led to believe just a few months ago."

In these times of economic tanking, it is good to see that local, good positions are plentiful.

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