Economists See Rising Risk of Recession

Nearly all in survey say Fed must take strong action, cut rates
By Jim O'Neill,  Newser User
Posted Dec 11, 2007 6:59 AM CST
Trader Michael Scagnelli bites his fingernail as he works on the floor of the New York Stock Exchange, Monday, Dec. 10, 2007. Wall Street advanced Monday as expectations for an interest rate cut from...   (Associated Press)
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(Newser) – Economists are painting a bleak picture of the US economy next year, with the housing mess, reduced job growth, and rising unemployment putting the likelihood of recession at its highest level in three years, the Wall Street Journal reports. Nearly all the economists surveyed by the paper said the Fed must take strong action to support recovery.

The Fed, said one, should act to “avert risk of recession and stabilize the financial crisis." Of 52 economists, 88% say the Fed needs to cuts rates today. The 52 economists surveyed say the potential for recession is 38%, up from 33.5% in November. The group also said Rudy Giuliani (35%) would be best for the economy, followed by John McCain (19%).