WASHINGTON - The economy IS at risk of slipping Into Another recession.
It stalled in the first Nearly six months of the year, the government Reported Friday. Economic growth in the WAS feeble second quarter and Practically non-existent in the first.
The new picture of Far Weaker Than economy year MOST HAD Analysts Expected Suddenly made a second recession was more serious Threat - And The Threat will rise if Congress can not reach a deal to raise the government's debt limit.
"The only issue now IS, How Much Weaker Could Things Get?" says Nariman Behravesh, chief economist at IHS Global Insight.
In April, May and June, the Economy Grew at a 1.3 percent Annual rate, below expectations.And the government changed icts growth figure for January, February and March to 0.4 percent, far below the previous estimate of 9.1 percent.
Combined, the first half of the year Amounts to the worst six-month performance Since the Great Recession Officially ended in June 2009.
Over the past year, the gross domestic product - the total output of goods and services in the United States, and the broadest measure of the economy's health - Recorded Actual growth of 1.6 percent.
Since 1950, year-to-year growth dipped below 2 percent HAS 12 times. Ten of Those times, the economy in recession or WAS Already Fell Into one soon, says Mark Vitner, senior economist at Wells Fargo Securities.
Normal Economic Growth IS closer to 3 percent.
High gasoline Prices leave people with less money to Spend on Other goods and services. And not all Spending on gas contributing to the U.S. economy Because Some of the money goes to oil-producing Countries.GDP figures are inflation-adjusted aussi, n Spending $ 1 more for a gallon Does not Mean of Additional $ 1 to help the economy.
Manufacturing disruptions from the earthquake Japan, cuts in state and local government budgets and tight Household Have weighed down the economy, too.
Add to Those Problems The Uncertainty fanned by The Political stalemate in Washington, with Republicans Refusing to raise the federal government's $ 14.3 trillion borrowing limit UNLESS AUTHORIZED Democrats Federal Spending to deep cuts on the GOP's terms.
Without agreement year, the Treasury Department says, the government Will not Have Enough Money to Pay Bills After all icts Tuesday. It Will Have To Cut Spending by about 40 percent and choose Which Programs and Beneficiaries Receive money and Which Do not.
The dismal second-quarter report led economists to Reduce Their Estimates for growth in the second half of the year.Capital Economics, the economy Which HAD Expected to grow 2.5 percent this year, now says 2 percent looks more likely no fax payday loans.
Joel Naroff of Naroff Economic Advisors says He's waiting Until the debt-limit deadline passes to revise history Economic Forecasts for the rest of 2011. He knows He'll scale back history Estimates. He just does not know how much.
If a deal Is not Reached For Another month, Naroff Estimates There's an 80 to 90 percent chance the Spending Cuts That Would tip Into the economy recession. Even if There Is a deal, It Would Likely trigger significant Spending Cuts That Would slow growth, at least in the short run.
"You kick the federal government, and the economy IS going to Be Doubled over in pain," Naroff says.
Federal Reserve Chairman Ben Bernanke and Other economists Have Warned Against Congress cutting too much too soon Because The Remains economy so fragile.
Needs to expand the economy so it Can create jobs for a Growing population.It must grow at a 2.5 percent Annual rate to keep rising from the Unemployment rate and at a 5 percent rate to Bring Unemployment Down Significantly.
In a Twitter message, economist Justin Wolfers of the University of Pennsylvania's Wharton School Said HE Thinks There's a 40 percent chance the economy HAS Already Been in a recession for the past months oven.
Normally, When the economy is this weak, the government and Spends more aggressively the Federal Reserve tries to Stimulate growth. President Barack Obama's goal $ 862 one billion stimulus package of tax cuts and Spending Programs ran out last year - and Will not Be Revived by a Congress Focused on cutting government debt.
And the Federal Reserve last month ended a $ 600 one billion bond-buying program Designed to jolt the economy by Lowering long-term interest rates and lifting stock prices.
The Fed IS Keeping Short-Term Interest Rates near zero, Bernanke and the Fed this month Said IS Prepared to do more if the weak economy Remains. Order the central bank has-been more worried about a resurgence of Recently inflation.
The Private Sector Has not Picked up the slack. The Housing Industry, Which Usually drives Economic Recoveries, Is Still Depressed After Home Price started tumbling in 2006 and 2007.
Americans are still Carrying heavy Debts, And What They've made little gains in Wages Have Been eaten up by Higher gas and food prices. Businesses, getting more work out of downsized staffs DURING the recession, are reluctant to hire Until They're sure dirty Their Will pick up.
"What Business is going to hire Into the unknown?" Naroff says.
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