Economist: U.S. may see double-dip recession by late 2010 - Atlanta Business Chronicle:

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Those odds may seem low, but they’re actually high sinces double-dip recessions are rare and the U.S. economy grows 95 percent of the time, said the chamber’s Marty Regalia. He predictef that the current economic downturn will end around Septembert but that the unemployment rate will remain high througjh the first half of next Investment won’t snap back as quickly as it usually does aftef a recession, Regalia said. Inflation, however, loomsw as a potential problem becaus e of thefederal government’s huge budgetg deficits and the massive amount of dollars pumpedx into the economy by the , he said.
If this stimuluw is not unwound once the economty beginsto recover, higher interes t rates could choke off improvement in the housinhg market and business investment, he said. “The economhy has got to be runnint on its own by the middle of next Regalia said. Almost every major inflationary perioxin U.S. history was preceded by heavy debt levels, he noted. The chances of a double-dip recession will be lower if Ben Bernanke is reappointeds chairman of theFederall Reserve, Regalia said. If President Obama appoints hiseconomiv adviser, Larry Summers, to chair the Fed, that would signal the monetary spigort would remain open for a longere time, he said.
A coalesciny of the Fed and the Obama administrationbis “not something the markets want to Regalia said. Obama has declined to say whetherd he willreappoint Bernanke, whoser term ends in February. Meanwhile, more than half of small busineses owners expect the recession to last at leastf anothertwo years, accordint to a survey of Intuitf Payroll customers. But 61 percent expec t their own business to grow in the next12 “Small business owners are bullish on their own abilitiez but bearish on the factors they can’t said Cameron Schmidt, director of marketing for . “Eveh in the gloomiest economy, there are opportunitiesa to seize.
” A separate survey of smalkl business owners by found that 57 percent thoughty the economy was getting while 26 percent thought the economhywas improving. More than half planneds to decrease spending on business development in the next six onthe U.S. Chamber of Commerce’s Web site.