US econ­omy still not on easy street

The Pak Banker - - International3 -

NEW YORK: The US eco­nomic re­cov­ery re­mains on shaky ground, well over a year af­ter the re­ces­sion of­fi­cially ended, and two top strate­gists said on Mon­day they fear the econ­omy could suf­fer a new blow next year.

The big con­cern is that growth re­mains teth­ered to govern­ment sup­port and is still not suf­fi­cient to re­duce an un­em­ploy­ment rate that last month sur­prised fi­nan­cial mar­kets with a rise to 9.8 per­cent.

Speak­ers at the Reuters 2011 In­vest­ment Out­look Sum­mit in New York on Mon­day were cau­tious about the econ­omy's prospects. John Tay­lor, chief ex­ec­u­tive of FX Con­cepts, which op­er­ates the world's largest cur­rency hedge fund, gave the bleak­est as­sess­ment. "I would ar­gue that by the mid­dle of next year, we will be in a re­ces­sion," said Tay­lor, not­ing that the govern­ment re­mains the biggest cre­ator of growth since the re­ces­sion ended in June 2009. Gail Fosler, pres­i­dent of the GailFosler Group LLC, a strate­gic ad­vi­sory ser­vice, also warned of chal­lenges at the Reuters In­vest­ment Sum­mit. "We are still in a time where there seems to be more down­side risks. -Reuters

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