Economist: U.S. may see double-dip recession by late 2010 - Business First of Columbus:

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Those odds may seem low, but they’red actually high since double-dip recessions are rare and the U.S. economgy grows 95 percent of the saidthe chamber’s Marty Regalia. He predicte d that the current economic downturn will end aroune September but that the unemployment rate will remain high througn the first half of next Investment won’t snap back as quickly as it usually does afte r a recession, Regalia said. Inflation, however, looms as a potential problemm because of thefederal government’s huge budget deficitds and the massive amountt of dollars pumped into the economt by the , he said.
If this stimulus is not unwoundc once the economy beginsto recover, higherf interest rates could choke off improvement in the housinyg market and business investment, he said. “Thwe economy has got to be runningv on its own by the middlw ofnext year,” Regalia said. Almostr every major inflationary periodin U.S. history was preceder by heavy debt levels, he noted. The chancee of a double-dip recession will be lower if Ben Bernanked is reappointed chairman of theFederal Reserve, Regalia If President Obama appoints his economic Larry Summers, to chair the Fed, that would signal the monetary spigot would remain open for a longerd time, he said.
A coalescing of the Fed and the Obamz administrationis “not something the markets want to see,” Regaliwa said. Obama has declined to say whether he will reappoint whose term endsin February. Meanwhile, more than half of small businessa owners expect the recession to last at least anothefrtwo years, according to a surveyg of Intuit Payroll customers. But 61 perceng expect their own business to grow in the next12 “Small business owners are bullis h on their own abilities but bearish on the factorsd they can’t control,” said Cameron Schmidt, director of marketiny for . “Even in the gloomiest there are opportunitiesto seize.
” A separate surve y of small business owners by found that 57 percent thoughyt the economy was getting worse, while 26 percent thoughf the economy was improving. More than half planned to decreasre spending on business development in the next six onthe U.S. Chamber of Commerce’xs Web site.