Most forecasts put an economic recovery sometime in 2010. Fed Chairman Ben Bernanke reaffirmed that today, although the headlines on his statement (though all accurate) tell slightly different stories:
Bernanke: Economy Suffering Severe Contraction (Associated Press)
Bernanke Sees 2010 Recovery Only if Banks Stabilize (Bloomberg)
Bernanke Says Recession Should End in 2009 (Wall Street Journal)
Here is the full statement from Bernanke.
He says, aptly, that the outlook is "subject to considerable uncertainty." Here's what he says about a recovery:
"If actions taken by the Administration, the Congress, and the Federal Reserve are successful in restoring some measure of financial stability - and only if that is the case, in my view - there is a reasonable prospect that the current recession will end in 2009 and that 2010 will be a year of recovery."
The National Association for Business Economics also came out with a statement this week on the economic outlook. The group says that business economists are "decidedly more pessimistic" on the economy over the next several quarters. They cited tight credit conditions, declines in equity markets and home values, as well as job losses - all of which are squeezing consumer spending.
The risks for 2009 continue as housing and labor markets continue to decline, the group says. NABE forecasts real GDP to rise at a 1.6% rate in the second half of this year, which means a decline of 0.9% overall this year. Business investment will continue to decline, though government spending is expected to grow 2.8%. NABE also forecasts unemployment to rise to 9% by the end of the year, and inflation to continue to moderate. The group forecasts growth of 3.1% in 2010.
Here's the recent MAPI/Manufacturers Alliance forecast, which says that GDP will decline 2.1% overall in 2009.