There is a saying that if we start talking about recession we are already in one. Could be the reason why politicians always avoid mentioning the word.
I still hope the US economy will just slowdown and not enter another recession but it is worth wile to look at some analysis that are already predicting the double dip. Please take those as just analysis and do not run for the woods just yet.
In an article in NYT, Rising Fears of Recession, David Leonhard looks at labor data for clues. He observes that:
“The United States appears to have entered some version of the vicious cycle. Most ominously, job growth has slowed to a pace that typically signals the start of a recession. ”
And “Over the last 50 years, every time that job growth has been as meager as it has been over the last four months, the economy has been headed toward recession, in a recession or in the immediate aftermath of one.”
I am sure the Fed is going to try something new soon but I do not think there is the answer. As everywhere in developed world and some emerging markets the answer to get out of this mess is with fiscal policy.