Its not at the level of a proclamation but the big guns at the Federal Reserve and economic advisors are pretty sure the worst is over. So says Vice Chairman of the Federal Reserve, Donald Kahn and New York Fed chief William Dudly. Even the tough guy, Paul Volker, is saying the economy's rate of decline is set to slow down.
The Fed has slashed interest rated from a peak of 5.25% to a range of zero to .25% in December. Fed officials say that there is a lag time between interest rate cuts and the effects of these cuts on the overall economy.
Paul Volker coined a new term for this mess. He says that we are "in a great recession." Most analysts see the low point as the fourth quarter of 2008 when US GDP shrank 6.3%. Chief economist of Freddie Mac, Frank Nothaft, says home sales are nearing bottom.
The comments were not all peaches and cream however. Dennis Lockhart, President of the Atlanta Fed warned of problems in the commercial real estate market. Paul Volker also sounded a pessimistic note about the current state of our banking system. He said that " the financial system is not quite comatose, but it's on life support."
Still another negative was sounded by Fed president Dudly. He said that public outrage over the financial bailouts and bonuses has made some investors wary of taking risks in the this market climate at a time when we need people to take risks to keep the economy moving forward.
Do you believe that the worst is over?
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Reader Comments (Page 1 of 1)
4-20-2009 @ 5:20PM
JCH said...
"Set to slow" is "the worst is over".
4-20-2009 @ 5:54PM
clikdawg said...
Naturally, these guys can be trusted to give you the absolute straight dope, because they have done so religiously in the past and have no vested interest in spinning the current situation this way this besides a deep and abiding respect for The Plain Unvarnished Truth.
Ah well, in the words of the poet:
"The story's in the past with nothin' to recall
I've got my life to live and I don't need you at all
The roller-coaster ride we took is nearly at an end
I bought my ticket with my tears, that's all I'm gonna spend
"And I think it's gonna be alright
Yeah, the worst is over now
The mornin' sun is shinin' like a red rubber ball ... "
Drive defensively, y'all, y'heah?
4-20-2009 @ 8:19PM
Bill said...
Unfortunately the, "BIG GUNS" do not have any amno in their cannons.
Where do these, "So Called Experts" live?
In an asteriod headed for another solar system?
I am not an economist but I would venture to make an."Educated Guess" that we will not see the ecomomy slowly moving back to a positive situation until the middle or end of 2010.
We have yet to see the credit card collapse.
4-21-2009 @ 6:03AM
al coholic said...
Clickdawg...that was sung by the Circle, if I remember correctly...nice lyrics. When that song came out I thought it told a great story. Too bad the music was so upbeat we missed the message.
Now we are all "facing the music," economically anyway.
4-21-2009 @ 8:01AM
clikdawg said...
Al --
You got it -- (and that's "Cyrkle", with a "y" and a "k") -- the song was co-written by Paul Simon.
There's a really good, sorta slow, soulful/downbeat version by Simon & Garfunkle; I think recorded at a 1980 concert, if you can find it -- got that Everly-Brothers-Howling-Quietly-At-The-Moon quality they did so well on their "Saturday Night Live" rendition of "Kathy's Clown".
Gives you the good chills, bro' ...
4-21-2009 @ 10:46AM
TX CHL Instructor said...
Ah, yes, the call of the lambs to the slaughter. All you idiots go out and buy stock now, so that the insiders can get theirs before the crash.
--
www.chl-tx.com (Thanks, BHO, for the fantastic stimulus you have given *my* business!)