The United States is once again becoming the epicenter of an economic crisis. Goldman Sachs analysts warned clients in a note that the signs of a slowdown are multiplying, and market players fear the possibility of a repeat recession.
Professor Robert Shiller of Yale University said the probability of a repeat recession is over 50 percent. In the coming one and a half to two years, the chances are higher for a second recession than for a recovery, economists from the Federal Reserve Bank of San Francisco wrote in a note, Reuters reported.
Fears of second recession rose Tuesday when Federal Reserve Chairman Ben Bernanke acknowledged that the economic recovery has slowed. The Federal Reserve has decided against getting rid of assets, purchased during the crisis, to reduce the national debt. Overall economic activity is growing for the time being, but slower than expected, U.S. Secretary of Commerce Gary Locke said, commenting on July retail sales data that were released Friday.
The U.S. economy will cease to grow by the end of the year and the crisis will last until 2013, New York University professor Nouriel Roubini said, noting that the government's stimulus program is coming to an end and the nation's debt problems continue to grow. Monetary policy alone cannot solve all the problems facing the United States, he added.
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