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Even if a downgrade in US credit is not imminent, the underlying conditions that raised such fears are worrying investors about what the future holds.
The move Thursday by Standard & Poor's to cut Britain's credit outlook has raised fears that the US may be next.
Federal Reserve officials, who see possible signs of “stabilization” in the U.S. economy, signaled they’re not convinced those improvements will persist.
Policy makers, meeting April 28-29 in Washington, saw “significant downside risks” to the outlook for the economy, with the global financial system still “vulnerable to further shocks,” minutes of the session released yesterday said.
The report indicates that Fed officials may be ready to build on their plan in March to buy $300 billion of Treasuries should the economy or financial markets deteriorate further.
U.S. Federal Reserve Chairman Ben Bernanke told law school graduates on Friday that the recession-mired U.S. economy would recover and to remain optimistic about their job prospects.
"Things usually have a way of working out," he told the graduating class of the Boston College School of Law.
"Restoring economic prosperity and maximizing economic opportunity are the central focus of our efforts at the Fed," he added.
The Fed chair told students to disregard pessimistic commentary about the future of the U.S. economy and its role in the world.
"The economy will recover -- it has too many fundamental strengths to be kept down for too long -- and the mood will brighten," he said.
Originally posted by marg6043
I wonder what the Fed is getting ready for,
Fed Unconvinced Economy’s ‘Stabilization’ to Persist
Unemployment is likely to continue over 9 percent and will continue rising into 2010 before starting to go down somewhat later that year.
Friday, May 22, 2009 Mass Layoff Events Pick Up,
Faciliate EPS Beats
Posted by Tyler Durden at 1:55 PM The Bureau Of Labor Statistics' Mass Layoff Events statistic indicates that the wholesale firing by corporations
is accelerating once more again after a small respite in the January to March period.
The BLS defines a Mass Layoff Event as one that occurs when an establishment has at least 50 initial unemployment compensation claims filed against it within a five-week period and the layoff lasts longer than 30 days. In other words, as the name implies, a mass layoff (and the reason for EPS to be sterling when revenues continue collapsing in all those Q1 earnings calls).
This goes hand in hand with initial jobless claims reports. Chart of both are provided below (link to BLS data here). Kinda tough to spot the green shoots through the very deep parasitic undergrowth on these two charts.