EconomicCrisis.US

The economist who beat 53 of his peers in guessing how the recovery would unfold in 2010 won by predicting very moderate growth which would keep unemployment high and the Federal Reserve’s policy easy.

Paul Ashworth of Capital Economics, a private forecasting group, predicted that fourth-quarter gross domestic product would be 2.8% above its year-earlier level and that joblessness would average 9.6%, landing him at the top of The Wall Street Journal’s annual ranking of economists.

All 54 economists submitted their predictions at the beginning of 2010. Compared with previous years—particularly 2009, when the economic slump blindsided many forecasters—all the survey economists were close to the mark.
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It is hard to believe that just two years ago President Obama was taking the oath of office. His inauguration came at the same time our economy, reeling from eight years of President Bush’s failed economic policies, was hitting rock-bottom. We were losing almost 800,000 jobs every month, the stock market was in free fall and the auto industry that drove us through World War I and II was in danger of complete collapse.

It was worse than the recession of the early 1990s, and even worse than the economic downturn of the ’70s. Thankfully, we have made monumental progress over the past two years.
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U.S. Treasury Secretary Timothy Geithner on Wednesday said repealing healthcare reforms would damage the economy, as the House of Representatives debated the law’s repeal.

“Repealing the Affordable Care Act would be bad for business and bad for the economy,” Geithner said in a blog posting on the Treasury’s website.

“We are at a crucial stage of the economic recovery. While the private sector has expanded payrolls for 12 straight months, the unemployment rate remains at an unacceptable level,” Geithner said. “Given where we are, we must do things that help bolster the recovery, and repealing the Affordable Care Act would be a step in the wrong direction.”
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A self-sustaining recovery that is driven by improving consumer and business spending may be taking hold in the U.S. economy, the chairman of the U.S. Federal Reserve says.

“Real consumer spending rose at an annual rate of 2.5 percent in the third quarter of 2010 [July to September], and the available indicators suggest that it likely expanded at a somewhat faster pace in the fourth quarter [October to December],” Fed Chairman Benjamin Bernanke said in congressional testimony January 7.
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