A Recovery At Risk

Policy Paper

By

Samuel Sherraden

and

Sherle R. Schwenninger

Oct. 11, 2010

Click here to download the slideshow, "A Recovery at Risk."

Contents

I. Drivers of the Recovery

Inventory Rebuild
Business Investment
Government Stimulus
Government Support for Consumers
Consumption Gains

II. Growth is Fading

End of the Inventory Rebuild
Slowing Business Investment
Government Stimulus Declines
A State Fiscal Crisis Bites
Eroding Income Support
Consumer Rebates Borrow Demand

III. Continuing Headwinds

Household Deleveraging
Deleveraging Means More Savings
Credit Continues to Contract
A Housing Collapse
Declining Household Wealth
High Unemployment
Wage Stagnation
Widening Trade Deficit
Global Overcapacity and Devaluations
Policy and Business Uncertainty

IV. Policy Implications

A Bleaker Outlook
Policy Produced an Unsustainable Recovery
Policy Conclusions