Feds: Recession May Be In Final StagesSeveral top Federal Reserve officials said on Thursday that the long lasting economic downturn in the country may be in its final stages. They warn that the early stages of recovery won't be pretty.
Dallas Fed President Richard Fisher, the self-described most pessimistic member of the Federal Open Market Committee, says the Fed's efforts at aggressive rescue should soon see results to stop the decline in growth.
Fisher's comments were made at a conference in Dayton, OH. He says weakness could be tempered after this quarter that may match last year's 6.3 percent contraction in gross domestic product.
Minneapolis Fed President Gary Stern says at least a mild recovery should take hold by mid-year before healthier growth kicks in during 2010. Stern spoke at the Economic Club of Minnesota. Stern says many pieces are now in place to contribute to improvement in financial market conditions and in business activity. He adds there is reason to think that improvement is not too far off.
Jeffrey Lacker, Richmond Fed President, also sees the recent increases in U.S. retail sales, lower gasoline prices and steady wages as signs for hope on the economy. He says it is reasonable to expect the economy to hit bottom later this year and then begin a gradual recovery. Dennis Lockhart, Atlanta Fed President, isn't as optimistic and predicts the recession would drag on for at least a few more months. He says one month does not make a recovery. The recent reports of better than expected economic data should not be overstated.
March Rally Continues for Wall Street
Good news from corporate earnings and a strong demand for government debt at the Treasury's latest auction helped Wall Street's March rally gain speed on Thursday, although markets subsequently were down early Friday.
Investors were antsy before about the federal government's ability to fund its economic stimulus and financial bailout programs. Dow Jones industrial average rose 174 points, finishing at its highest level in almost six weeks. The index surged 21 percent after hitting a near 12-year low on March 9.
A quartet of companies, Best Buy Co., ConAgra Foods Inc., and Dr Pepper Snapple Group Inc. announced quarterly profits higher than analysts' expectations.
The Dow jumped 2.3 percent, to close at 7,924.56, its highest close since Feb. 12. Standard & Poor's 500 index rose 18.98, or 2.3 percent, to 832.86, and the Nasdaq composite index rose 58.05, or 3.8 percent, to close at 1,587.