Risk of US double-dip recession rises, warns Standard & Poor's

Risk of US double-dip recession rises, warns Standard & Poor’s

Posted on August 22, 2012 by The Extinction Protocol

August 22, 2012 – ECONOMY – The odds the United States will slip back into recession next year have risen, ratings agency Standard & Poor’s said, citing risks from the European debt crisis and budget tightening at year-end. The US ratings firm raised the chance of the US falling into recession to 25 percent, up from a 20 percent chance estimated in February, as the world’s largest economy struggles to recover from a severe 2008-2009 slump. It also pointed to the looming possibility of the government being forced by existing law to severely cut spending and increase taxes on January 1, the so-called fiscal cliff that would crunch the economy. “Economic activity has downshifted sharply from earlier this year,” S&P said in a report on North American credit conditions amid global uncertainty, dated August 20. “At the same time, possible contagion from the European debt crisis, the potential so-called ‘fiscal cliff’, and the risk of a hard landing for China’s economy have added greater uncertainty to US economic prospects,” it said. In the second quarter, the world’s largest economy grew at a 1.5 percent annual rate, a sharp slowdown from late last year as unemployment remained stuck above 8.0 percent. S&P underscored concern about the impact of a recession in the 17-nation eurozone, whose economy contracted 0.2 percent in the second quarter. S&P forecast a 0.6 percent contraction this year. “A double-dip recession in Europe that transmits financial turmoil to the US could push it into recession,” the agency said. However, S&P said its baseline scenario for the US economy — remained “modest growth,” projecting a gross domestic product expansion of about 2.1 percent for this year. S&P also said it expected that politicians would agree before year-end to change the current severe budget cut and tax hike mandates to avoid the fiscal cliff fate. However, it said, “We do not believe the US and European economies will improve substantially in the next year.” –Yahoo News

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10 Responses to Risk of US double-dip recession rises, warns Standard & Poor’s

Duke says:

August 22, 2012 at 12:39 pm

It is a myth that the US economy is out of a recession at the present time.

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- Nkosazana says:
  
  August 22, 2012 at 2:40 pm
  
  Agreed. Besides I find it an irritation that they keep using the word recession instead of depression. It’s like the prefer a ‘milder’ word to allay our anxieties, but reality is not only did we not get out of the first one, it was not recession in the first place but a slow slide into depression.
  
  Reply
- Skeptical citizen says:
  
  August 22, 2012 at 5:51 pm
  
  I agree with Duke the recession is still happening. Its very likely it will turn into a world wide depression.
  
  Reply
Laura says:

August 22, 2012 at 1:11 pm

I agree Duke it is a myth. We are not in a recession but a depression for some time now. Guess it is just a matter of semantics when these reports come out. Truth is things will get worse before it gets better. The wise will see trouble and prepare the fool rushes in and is destroyed.

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candz says:

August 22, 2012 at 2:23 pm

I still don’t believe that some americans don’t realize the gravity of our current econic crises! It will only get worse! The unemployment figures were inaccurate and there are more people being put out into the streets each day. Currently we have more vacant houses than we do homeless people and 200-300 families standing in line for hours waiting for a community food truck that can only serve 100.

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Dennis E. says:

August 22, 2012 at 10:30 pm

If conflict breaks out, it could slip into a depression……..

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Kathy says:

August 22, 2012 at 10:31 pm

It really should be reading …Depression…

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truefaith says:

August 23, 2012 at 2:55 am

so to me this is all smoke and mirrors, maybe i am getting paranoid as of lately but i think the real main players are the ones instigating the money issues.as it is only a issue when the people that have been robbing us and i mean all of us in all counties are the same ones saying no more borrowing. well had they not ripped all the people off for all this time- they would not be in control of so much money. from what i have been seeing this is all intertwined by alot of the same people.

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jeff says:

August 23, 2012 at 3:43 am

standard and poor says we MIGHT slip BACK into a recession NEXT year? that is the biggest crock i have ever heard. forget recession, we are basically in a depression, we NEVER recovered from the ‘great panic of ’08″. all we did is throw money at the banks {TARP}, all we did was throw money at the auto industry, operation twist continues to prop up the stock market [they should change the name of wall street to lil Vegas for all the bets that are made every millisecond]…yeah thats right miliseconds…real men and women dont even buy and sell on wall street any more. its bots that make thousands of trades within seconds. that way its harder to find out that ALL the money is going to off-shore bank accounts and not to were the trade should have gone.

a recession NEXT year? how about 41 months straight of 8+ percent unemployment? never been seen…and that is the NUMBERS the government gives you. the real number is more like 13-14% unemployed, around 30 million people with no job or serverely underemployed with NO health benefits.

what about the 48 million people on food stamps? that number was 20 million just 3 and a half years ago, it has doubled in that short period of time. UNREAL

Heck i bet the white house WROTE this S&P report themselves…

WE DO NOT BELIEVE YOU ANY MORE

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Grandpa says:

August 23, 2012 at 10:28 am

In the last 6 yrs the only thing ive purchased was a bbq… i am set for another 12 yrs .

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