Odds of Second Recession Grow: Economists

And Fed can't do much to stop it, say experts
By Matt Cantor,  Newser User
Posted Sep 16, 2011 7:52 AM CDT
In this photo taken Sept. 12, 2011, Robert Gross of Barclays Capital works on the floor of the New York Stock Exchange.   (AP Photo/Henny Ray Abrams)

(Newser) – Economists are citing a one-in-three chance of a new recession—the highest likelihood given in the Wall Street Journal’s regular survey since the recovery began. The figure is 4 percentage points higher than last month’s as joblessness, a troubled stock market, and fears for Europe continue. “It feels like a recessionary environment. What they call it later on I can't tell you,” one expert tells the Journal. His organization sees a 45% chance of a new recession.

Every time his group, the Conference Board, has put the odds of recession above 40%, a downturn has occurred, the Journal notes. And at any rate, he says, “the consumer has never really thought that we got out of the recession.” The Federal Reserve will meet next week, and economists expect it to take action—but they don’t expect much effect. “All the major cards have been dealt. The monetary actions will only have marginal effects on the economy,” says one.

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