According to a recent survey of Associated Press (AP) for 43 leading economist, the chance that U.S. will be in another recession is very low over the next 12 months, and there would be no meaningful improvement as well, due to the high unemployment and weak consumer spending.
The confidence of investors generally is like the oxygen in the system, when there are less and less oxygen, the system becomes weaker and weaker. The investors spend and invest less, selling more stocks and making the market decline further. According to Beth Ann Bovino, the senior economist at S&P, each day that the stock market sinks “puts another nail in the coffin of the recovery.”
The survey concludes several points below:
• The probability of recession within next 12 months is 26%. Back in June, this probability is around 15%.
• The economy will inch ahead at an annual rate of 2% for the third quarter and 2.2% for the last quarter.
• Weak consumer spending is the major risk to the country. In June, Americans cut their spending for the first time in nearly two years. And consumer spending fuels about 70% of the economy
• The unemployment rate will end this year at 9% and 2012 at 8.5%. It’s less than 9.1% in July. But economists are more consistent with a recession than a recovery.
• Low rate policies may boost stock prices, but the Fed’s effort to keep rates low may not promote growth or reduce the unemployment rate.
The full article can be viewed in the following link:
AP Survey
The confidence of investors generally is like the oxygen in the system, when there are less and less oxygen, the system becomes weaker and weaker. The investors spend and invest less, selling more stocks and making the market decline further. According to Beth Ann Bovino, the senior economist at S&P, each day that the stock market sinks “puts another nail in the coffin of the recovery.”
The survey concludes several points below:
• The probability of recession within next 12 months is 26%. Back in June, this probability is around 15%.
• The economy will inch ahead at an annual rate of 2% for the third quarter and 2.2% for the last quarter.
• Weak consumer spending is the major risk to the country. In June, Americans cut their spending for the first time in nearly two years. And consumer spending fuels about 70% of the economy
• The unemployment rate will end this year at 9% and 2012 at 8.5%. It’s less than 9.1% in July. But economists are more consistent with a recession than a recovery.
• Low rate policies may boost stock prices, but the Fed’s effort to keep rates low may not promote growth or reduce the unemployment rate.
The full article can be viewed in the following link:
AP Survey
