Recession’s over, but the pain’s not

The worst recession since the 1930s is over, but the recovery is just starting to walk the long, difficult road before it, says Michael Moskow, the former Chicago Fed chief and current Vice Chairman and Senior Fellow at the Chicago Council on Foreign Affairs.

Leading off a slate of high-profile economists and financial thinkers at the second annual Global Financial Leadership Conference this afternoon in Naples, Fla., Moskow said that while the economy is out of the dire financial situation it faced one year ago, troubles in unemployment and consumer spending will continue to weigh on the economy. “Even though real GDP is increasing and the recession probably ended with this most recent quarter, it still is not going to feel good.” That’s because the national unemployment rate is likely to rise, peaking over 10 percent in the first quarter of 2010 and won’t sustainably fall below 7 percent until perhaps 2012 or later. Since consumer spending accounts for the bulk of economic activity, the strides made in stabilizing banks and the economic system this past year will be held back by pressured American shoppers suffering from wage stagnation and weak housing values.

Moskow’s opinions are particularly valued because… Continue reading at my coverage of the conference for Nasdaq.com here