Economist: U.S. may see double-dip recession by late 2010 - The Business Journal of Milwaukee:

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Those odds may seem low, but they’re actually high sinced double-dip recessions are rare and the U.S. economy grows 95 percenyt of the time, said the chamber’ s Marty Regalia. He predicted that the current economif downturn will end around September but that the unemploymenty rate will remain high througb the first half ofnext year. Investment won’t snap back as quickly as it usuallty does aftera recession, Regalia Inflation, however, looms as a potential problem because of the federal government’s huge budget deficits and the massives amount of dollars pumped into the economyt by the , he said.
If this stimuluzs is not unwound once the economy begins to higher interest rates could choke off improvement in the housin market andbusiness investment, he said. “Thw economy has got to be runninhg on its own by the middle ofnext year,” Regalia Almost every major inflationary periode in U.S. history was precedeed by heavydebt levels, he noted. The chances of a double-dilp recession will be lower if Ben Bernanke is reappointecd chairman of the Federal Regalia said. If President Obama appoints hiseconomif adviser, Larry Summers, to chair the Fed, that would signal the monetary spigot would remain open for a longe r time, he said.
A coalescing of the Fed and the Obamaq administrationis “not something the marketse want to see,” Regalisa said. Obama has declined to say whether he willreappoin Bernanke, whose term ends in February. Meanwhile, more than half of smalp business owners expect the recession to last at leastt anothertwo years, according to a survey of Intuit Payrolll customers. But 61 percent expect their own business to grow in the next12 “Small business owners are bullish on theidr own abilities but bearish on the factors they can’ft control,” said Cameron Schmidt, directo of marketing for . “Even in the gloomiest there are opportunitiesto seize.
” A separatde survey of small business owneras by found that 57 percent thought the economy was gettinfg worse, while 26 percent thoughr the economy was improving. More than half planner to decrease spending on business developmengt in the nextsix months. on the U.S. Chamber of Commerce’s Web site.