The U.S. economy is expected to shrink 0.4% in 2009 compared with 2008, according to the monthly survey of 49 economists published Monday by Blue Chip Economic Indicators. ...Note again that although this is the worst financial crisis since the Great Depression, it is not the worst economic crisis since the Great Depression. The early 1980s recession was significantly worse than the current one. The two recessions since then—1990-91 and 2001—were both mild by historical standards, so it's not surprising that this one is worse.
The economists' median forecast calls for U.S. gross domestic product to fall by 2.8% in the final three months of 2008 and by 1.5% in the first quarter of 2009. ...
"The consensus strongly suggests that the current recession will be deeper and last longer than those of 2001 and 1990-91," said Blue Chip editor Randell Moore in his commentary.
"Some of our panelists believe it may rival the 1981-1982 downturn, but that is not yet the consensus view," he added.
The nation's unemployment rate is expected to average 7.4% in 2009; it was 6.5% in October. ...
The consensus sees the consumer price index, which tracks inflation at the retail level, rising by 1.5% in 2009 after a 4.2% gain in 2008.
Several bozos in the mainstream press keep getting this wrong. (Yes, I'm talking about you, Wolf Blitzer!) These journalists keep treating "financial crisis" and "economic crisis" as if they are synonyms. They are not synonyms! Journalists' ignorance of the difference between a financial crisis (a crisis affecting the financial system) and an economic crisis (a crisis affecting the broader economy) is causing them to mislead and scare the public.