Rasmussen: 62% of Americans See the Country in a Recession

Thursday, 02 Aug 2012 01:39 PM

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Most American consumers and investors feel the country has fallen back into a recession, a new Rasmussen Reports survey finds.

“Sixty-two percent of consumers continue to believe the U.S. economy is currently in a recession. The same amount of investors (62 percent) share that view,” the polling firm reveals.

Confidence among both consumers and investors is eroding, Rasmussen says.

Editor's Note: Economist Warns: 50% Unemployment, 100% Inflation Possible

The Rasmussen Consumer Index, which measures consumer confidence on a daily basis, dropped a point on Thursday to 84.8. Consumer confidence is up 6 points from a week ago, but down 2 points from a month ago and down 3 points from three months ago.

The Rasmussen Investor Index, meanwhile, fell six points to 89.6. Investor confidence remains largely unchanged from a week ago, but the figure is down 6 points from a month ago and down 4 points from three months ago.

“Ongoing concerns about the economy led both consumer and investor confidence to reach 2012 lows over the past week,” Rasmussen notes.

“Additionally, just 14 percent of Americans now believe that today’s children will be better off than their parents.”

Officially, the country is skirting above recession, though growth rates are cooling.

The U.S. gross domestic product grew 1.5 percent in the second quarter, according to advance estimates from the Commerce Department, down from 2 percent in the first quarter.

The Federal Reserve recently concluded at a monetary policy meeting that the economy is facing building headwinds.

“Economic activity decelerated somewhat over the first half of this year. Growth in employment has been slow in recent months, and the unemployment rate remains elevated. Business fixed investment has continued to advance. Household spending has been rising at a somewhat slower pace than earlier in the year,” the Federal Open Market Committee said in a statement after agreeing to make no change to monetary policy.

“Despite some further signs of improvement, the housing sector remains depressed. Inflation has declined since earlier this year, mainly reflecting lower prices of crude oil and gasoline, and longer-term inflation expectations have remained stable.”

The Fed added it would stand down for now and not roll out a new round of stimulus tools such as quantitative easing, which are bond purchases from banks that flood the economy with liquidity to encourage investing and hiring.

Should the economy deteriorate further, expect the Fed to intervene.

“The Committee will closely monitor incoming information on economic and financial developments and will provide additional accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability,” the Fed added.

Editor's Note: Economist Warns: 50% Unemployment, 100% Inflation Possible

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