Close but no cigar. Add another member to the "no recession" camp:
The UCLA Anderson Forecast is calling for real GDP growth to be just above 1% for the fourth quarter of 2007 and the first quarter of 2008. . . . In his national report, UCLA Anderson Forecast Senior Economist David Shulman asserts that the ongoing pessimism in the overall Forecast comes from the continuing deterioration of the housing market. The Forecast has lowered its expectations for housing activity as the tightening of credit standards, combined with an ebbing of the builders' practice of building new houses to get out of the underlying land takes its toll. . . . Down the line, growth will remain lukewarm until the economy returns to a 3% trend in 2009. The expectation is that the Federal Reserve will cut the Fed funds rate from 5 ¼% to 4 ½% by year-end. The economy will avoid recession on the strength of net exports and business investment in equipment and software. It's expected that it will take years for the housing market to recover to "normal," a situation likely to be exacerbated in the short-run by changes in the legislation affecting the mortgage industry.
My take: UCLA buried the "lede," the more I think about it. That last sentence about the effect of congressional action on the mortgage industry is critical.
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