The U.S. struggles to recover from an economic coronary
Traders signal offers in the Standard & Poor's 500 stock index futures pit at the CME Group in Chicago, Ill., after the Federal Reserve announced plans to stimulate the economy.
JEREMY HOBSON: Now let's get to the new concerns about the economy. That bad private sector jobs report we told you about yesterday sent the Dow on its biggest point drop in a year. We found out this morning that 422,000 new people filed claims for unemployment benefits last week. That's not a good number. And the words "double dip recession" are everywhere today.
Diane Swonk is chief economist with Mesirow Financial. She's with us live now from Chicago as she is every Thursday. Good morning.
DIANE SWONK: Good morning.
HOBSON: Well Diane how could so much change in 24 hours?
SWONK: Well, it didn't really change as much as reality set in. What we saw was a tsunami of factors -- everything from Europe, Middle Eastern stability, to the reality of the production interruptions from Japan from the earthquake. They all hit the economy all at once. We saw the ADP report showing a big drop in manufacturing employment which has been the shining star of the recovery. That'll come back -- that's the good news. The bad news is if this economy was stronger it'd be a little more than a blip on a radar screen.
HOBSON: And I feel like there's a fear in the back of people's mind that as Washington starts to pull away some of the stimulus efforts that were put in place after the financial crisis that maybe we just delayed the inevitable and now the pain's about to come.
SWONK: Well, basically we had a massive coronary when we had the financial crisis and we're lucky to be alive. What Washington did was put us into intensive care, but we're still in the hospital and rehab is tough.
HOBSON: Rehab is tough. Diane Swonk, chief economist with Mesirow Financial thanks so much as always.
SWONK: Thank you.