Ask a few economists if the recession is ending, and a majority will say "Yes." Ask them how smooth the recovery will be, and the answer may not be what you want to hear. Pessimists are coming out even in the wake of continued good news on manufacturing, home construction and GDP. Their message? It will be a long time before any "recovery" actually feels like one.
Here are the foreboding signs they see in store:
- Stagnation, says Henry Blodget at Business Insider. "The message here is the usual one: After big bubbles, recovery takes time. Hopefully, our own recovery clock really started in 2000, so that we're 9 years in instead of 2 years in. But either way, history suggests we have may have several sideways years to go."
- No Jobs, says Annys Shin at the Washington Post. "Think of thousands of idled factories, acres of empty strip malls and ports packed with unsold automobiles, not to mention millions of workers who lost jobs as business scaled back production to keep up with falling demand."
- Another Bubble, says Colin Barr at Fortune. "What's more, this year has brought an 80% surge in emerging market stocks, while the dollar has posted a 10% decline since March. A declining dollar and surging emerging markets were the hallmarks of the credit-fueled bull run earlier this decade."
- Sluggish Consumers, says Phil Izzo in the Wall Street Journal. "Indeed any hope for recovery is going to have to come on the back of moderate increases in consumer spending...And that's going to be a tall order."
- Toxic Assets, says Douglas A. McIntyre at 24/7 Wall Street. "There are some important voices that say the legacy problem of bank balance sheet assets have not receded and that a number of banks, especially in the middle tier of the industry, may be severely crippled by 'toxic assets'."