Study: No Recession in 2008

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Real estate crash or not, the U.S. economy and California will escape recession in 2008, a UCLA study released today predicts, the Los Angeles Times reports.


Despite rising oil prices, sinking housing prices and a turbulent stock market, the national economy will be saved by some of its apparent weak spots, the quarterly UCLA Anderson forecast stated.


“Be calm, my friends. Be calm,” forecast director Edward Leamer wrote in the report.


Among the silver linings:


* The loss of 3 million manufacturing jobs early this decade means there is little room to cut more positions.


* Most of the damage to the economy from the housing slump will be over by the end of next year.


* The weak dollar will help U.S. exports, aiding manufacturers in Southern California.


* Consumer spending will drop, but much of the effect will be felt by other countries as U.S. imports of their products decline.


California’s economic outlook mirrors the nation’s, forecasters said. “It gets pretty ugly, but still no recession,” the report says. The state will be hit hard by the weak real estate market, falling government revenue and the Hollywood writers’ strike.



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