- Highlights
- Full Text
[2:32] ..." The stock market is expected to make a decent recovery this year. The S&P 500 index. Expected to and."...
[2:50] ..." Very very good recovery in the stock market expected to go along with. Fairly. Socio economic outlook in terms of growth."...
[3:08] ..." where there was the dot com -- the collapse of the and housing market and easy credit led to this current recession. Or are we liable to be more stable and with -- more modest returns"...
[3:23] ..." Like you raise a really interesting question one that are Federal Reserve policy makers are taking a hard look at. There examining -- regulatory structure. And especially focused on the banking system. And what we call"...
[5:16] ..." picking up only modestly in movement intent. The trick is for the Federal Reserve. To withdraw. The liquidity it provided to the financial system. Could it or not withdrawn lead to inflation down on the road"...
[0:00]" When will it end the recession it's been longer than at any time since World War II. But there could be some hope that he could end before this year is out. Joining us this morning the national association of business economics. President Chris -- arts. And you we knew her colleagues into Arabia heading out of this mess."
[0:21]" That's right our panel found that we expect GDP growth to turn positive in the second half the year so second quarter still decline in just about 2% that. Positive growth in the third quarter positive growth in the fourth quarter sub par but at least it deadbeats and declines in reaching for the prayers exporters."
[0:41]" How can be confident motive and the indicators that make you feel this way."
[0:45]" Well there are a number of areas of the panel sees -- turning around first of all housing is expected to bottom. I hear in the first or second quarter of the years ago housing sales which had been on a flat trend. World are expected to turn out housing starts which had been a major drag on the economy since early 2006. Are also expected to bottom. And an upturn in construction will help the economy recover in the second half. Also inventory investment which as firms have been. And those are expected to come to an end sometime in the very near future. And as orders picked up and restocking occurs or less people stocking -- that's also boosted economic growth."
[1:32]" Have been do you expect to live the growth the the Devoe Allman out of recession to be. Fairly modest stone chairman and this is going to be people whistling happy days are here again."
[1:42]" No and I think that's something it's. Very important to clarify over the second half the year growth would be expected to be just about 2%. First is what would be sustainable trend -- maybe little less than 3%. What's important is that typically coming out of very deep recession such as the one -- in. We would expect growth -- first work orders. To be something closer to 6% or 8%. Street so we're definitely getting. At least in the early stages of the country sub -- growth and as a result."
[2:16]" Unemployment will continue to write -- expected to peak at nine point 8%. And we won't see. Job increases until early in 30 and even then they'll be quite. All the market."
[2:32]" The stock market is expected to make a decent recovery this year. The S&P 500 index. Expected to and."
[2:41]" 2009975. And nearly reached eleven 1100. In the end of -- and so."
[2:50]" Very very good recovery in the stock market expected to go along with. Fairly. Socio economic outlook in terms of growth."
[3:00]" And Chris farmer says you look further into your crystal ball isn't likely they will continue what is happen over the last couple of decades is. A -- bus where there was the dot com -- the collapse of the and housing market and easy credit led to this current recession. Or are we liable to be more stable and with -- more modest returns on investments for example and relatively affordable credit."
[3:23]" Like you raise a really interesting question one that are Federal Reserve policy makers are taking a hard look at. There examining -- regulatory structure. And especially focused on the banking system. And what we call on bank intermediaries -- folks outside of the normal banking system is taken funds turnaround landed. And in the most recent episode. There's been very there was a high degree of leverage that gave rise -- it is. Potentially a fairly risky structures that -- prices began to fall. Firms had to begin selling assets. Because of a high degree of leverage and that just led to cascading effect. On adequate prices and so one of the things -- likely -- our. Much more stringent capital requirements for banks and perhaps for non bank lenders as well that will require them to keep. More of their own money. Backing the loans that they make and in that case the whole system will be somewhat more stable and in that case however it also implies lower rates of return. His financial firms. And he couldn't help but avoid the boom and bust but of course the danger here is we don't want to throw the baby out with the bath water in the nation's financial system is important we just don't want to. Goes too far in putting financial system and a --"
[4:42]" Sure but the final question with the government so deeply involve -- not just in the financial system but as we see more and more an industry like the normal -- business. Is is there a chance of -- the bill is due for all of this always all these billions that have been spent. That inflation is Federer totally."
[5:02]" Our panel actually views the inflation story is. Not so -- certainly for the near term. And so -- the panels that -- panels these inflation fighting. As we go through 2009. And picking up only modestly in movement intent. The trick is for the Federal Reserve. To withdraw. The liquidity it provided to the financial system. Could it or not withdrawn lead to inflation down on the road for the near term our panel these both inflation. And risk of deflation is fairly well contained. A longer term outlook obviously we would get probably more divergence of opinion as to whether inflation still -- it down or whether we turn around -- sharply."
[5:46]" Macro economist Chris spoke -- who was the president of the national association for business economics with the overall positive view of the -- the recession around the corner and then modest but hopefully sustainable growth in the years ahead. Chris thanks very much for being with -- at BZ."
Del.icio.us
Digg
Reddit
