Tags: Wolf | US | Economy | Miserable

FT’s Wolf: US Economy Will Be ‘Pretty Miserable’ for Years

Tuesday, 24 April 2012 07:20 AM

The U.S. economy may have performed reasonably well in the first quarter but recovery will remain choppy, disappointing and "pretty miserable" for years to come, says Martin Wolf, chief economics commentator at The Financial Times.

Massive headwinds face the U.S. and other developed economies in the form of too much debt and too little growth.

"My view throughout has been that we were going to have a very weak, very uncertain, very inconsistent recovery in all the developed countries," Wolf tells Yahoo's The Daily Ticker.

Editor's Note: Obama’s Economic ‘Fix’ is In . . .

"The U.S. can continue to grow, but it's going to be disappointing growth. I've always thought [the recovery] would be a 7-10 year process from the start."

The United States and other economies shouldn't embrace austerity too much, as cutting spending and debt can hamper growth, Wolf adds.

The eurozone won't avoid falling into a recession, and while the U.S. will continue growing, don't expect things to look like they did before the downturn.

"If you look at the underlying dynamics of the economy — consumption, investment, exports, government spending — they are going to be weak and uncertain," Wolf says. "I expect the U.S. to have a pretty miserable few years, and I think that will be true for whoever wins" in November.

The U.S. economy remains stuck in the doldrums and unemployment high.

While unemployment figures surprised on the upside in January and February likely due to unseasonably warm weather, they took a turn for the worse in March, when the economy picked up a net 120,000 jobs, way below expectations.

The headline unemployment rate stands at 8.2 percent, well above pre-crisis levels, yet a CNNMoney survey of economists sees the rate not improving much at all and finishing the year at 8 percent.

It's like "running in place," says Lynn Reaser, chief economist at Point Loma Nazarene University, CNNMoney adds.

Editor's Note: Obama’s Economic ‘Fix’ is In . . .

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Tuesday, 24 April 2012 07:20 AM
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