Catherwood LibraryILR School

While most economists agree that the U.S. is heading into a recession, the duration and severity of that recession, as well as the timing and strength of the following recovery, are questions that are still up for debate. The key issue on which this debate is turning is whether underlying structural weaknesses exist which remain unaffected by the fiscal and monetary policies undertaken by the president, Congress, and the Federal Reserve. Realistic predictions taking into account the influence of both September 11 and trends existing before the terrorist attacks, indicate a fourth quarter worse than the third quarter for 2001, unemployment peaking around six percent in early 2002, and a recovery in spring of 2002 that will see a return to growth in the GDP but not to the phenomenal profit margins of the late 1990's.