DALLAS-It wasn't hard to find the undercurrent of an Economic Forum here: how bad is it, and how long will the recession last?
During Southwest Corporate's Economic Forum here, noted economists Jeff Thredgold and Bill Hampel confirmed the obvious-the U.S. is in a recession, even if the official scorekeeper of recessions, the National Bureau of Economic Research, has yet to confirm. But the big concern on the minds of credit union executives was (and is) the shape of the financial markets.
Thredgold compared the U.S. economy to an eight-cylinder engine. "The auto sales cylinder clearly is in recession, as is housing," he said. "On the other hand, farming and exports are doing well."
Hampel, who is the chief economist for CUNA, told conference attendees the financial markets are in much worse condition than the "real" economy.
"All over the world, the credit markets are frozen," Hampel said. "What is going on on Wall Street is as bad as in the 1930s, but the rest of the world has experienced just a mild recession." But Hampel was quick to clarify, "This is not the 1930s."
Both Thredgold and Hampel expect the recession to be relatively mild. Thredgold said negative GDP growth will extend into the first quarter of 2009 before recovery begins. Assessed Hampel: "If the worst of the credit crunch can be dealt with in the next few weeks-and it appears it is-then a recession not much worse than 1990 or 2001 will ensue, then a long, slow recovery. If not, if the credit crunch resists concerted government action, then there could be a recession as severe as the early 1980s."
