Did we say no recession?
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Did we say no recession?
TEXT OF STORY
Scott Jagow: A lot of economists have been trying to take the optimistic view. Yes, the subprime mess is bad, but no, it won’t lead to a recession anytime soon. I’m afraid they might be changing their minds. Alisa Roth has the results of a Reuters poll out this morning.
Alisa Roth: More than 100 analysts took part in the poll. Most agree that growth will slow down to 2 percent by the fourth quarter of this year. In comparison, in the second quarter of this year, when the economy was healthier, it grew by 4 percent.
Economist Kathleen Camilli, who did not take part in the poll, thinks the Fed will lower interest rates when it meets next week. But she says that may already be too late:
Kathleen Camilli: It may in fact be the case that a recession is already baked in the cake, even before the Fed’s actions.
Camilli says she expects to see a recession three to six months from now.
Housing prices are still dropping in many parts of the country. Last month, we saw the first net decline in jobs in four years. And this week, oil hit an all-time high of $80 a barrel.
Camilli says investors who use products such as CDs should lock in rates now. But consumers looking for mortgages may find better rates in the months to come.
In New York, I’m Alisa Roth for Marketplace.
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