This downturn has been unlike any other. MarketWatch reports that Americans don't expect the US is going to recover from the recession. As Rex Nutting at MarketWatch reports: "High unemployment. Low wages. High gas prices. Falling home prices. An aggressive Federal Reserve. A dysfunctional Congress. A president known for his oratory who still hasn't found the words that could give us hope again. Given the weak performance of the economy, the frustration is understandable. But the tepid economic growth that underlies our fears was utterly predictable. In fact, it was predicted. The economic recovery, as weak as it has been, has been pretty much as advertised."
Blame some of that on the US Federal Reserve. As Binyamin Appelbaum writes in the New York Times , the only thing the Fed's policy of purchasing vast quantities of debt has done is pump up the stock market. Most Americans are not feeling the difference, because those benefits have been surprisingly small.
The big question is whether the inflation time bomb America is sitting on will tip it back into recession. Consultants at Customer Growth Services have warned that rising fuel and food prices in the US could be the tipping point that pushes America back into recession. They point out that energy prices have driven most US recessions. What makes it more difficult now is the rising price of food.
If the US is tipped back into recession, will it drag the rest of the world with it?
no comment untill now