money.cnn.com...
NEW YORK (CNNMoney.com) -- The U.S. economy is likely to deteriorate further this year and unemployment will rise into 2010, according to the
latest forecasts from the staff of the Federal Reserve.
This bleak forecast was presented to Fed policymakers when they met last month and lowered interest rates to near zero. Low interest rates are one key
tool the central bank uses to try to spur economic activity.
According to the minutes from that meeting, the central bank is now predicting that gross domestic product, the broadest measure of economic activity
will fall in 2009.
"I think that the Fed is really very scared right now -- like everybody else -- and they want to pull out all the stops," said David Wyss, chief
economist for Standard & Poor's.
Several thoughts come to my mind. Among them is the fact that starting with Black Friday there was a very apparent "clamming up" by the stuffed
suits in Washington and a virtual absence of any scathing rhetoric surrounding the recession. Small comments may have been made here and there, but
even while they were meeting behind closed doors to discuss the fact that they believe this is going to get much worse, the message being sent to the
American people was "get out there and take advantage of the sales to provide yourself a consumer's Christmas! Everything will be OK, we're fixing
this." Seems like the people who have been concerned about their jobs or their abillity to get out of debt in the next few years were wise to scale
back their consumerism this Christmas season.
I also am an ATS member, afterall, so I gotta take that cynical viewpoint towards the government on issues like this. That part of me aknowledges the
fact that our government has conspicuously tried to keep their tone several notches more chipper and optimistic than the facts indicate the situation
called for. They waited a year before even admitting that we were in a recession, now they are beginning to nudge us slowly towards acceptance of a
"deep" recession... Could this actually be a depression? I mean just a few weeks ago the official government statement was that we were looking at
a recession lasting into mid 2009. Now, without the markets doing much of anything worth noting, they're talking 2010... or later?
My final thought is related to the Fed chairman position. Considering the position is a puppet post anyway and the person sitting in it is more of a
figurehead who makes statements based on what his overlords want, would it be possible for Obama to select someone a little easier on the eyes to
replace Bernanke after he's sworn in? I'm really tired of seeing that Muppet with a Brillo pad glued to his face on every news report I read about
the economy. I'm thinking it would be a great change of pace and good for morale if the next fed chairman was, say, Megyn Kelly or Victoria
Silvstedt or hell, I'd even settle for Trish Stratus from the WWF... anybody whose face doesn't look like their neck just vomited.
