White House Lowers Economic Forecast for 2008

[flashl]

The White House on Thursday lowered its forecast for economic growth for next year and said unemployment will likely rise as the housing slump and tight credit stunt business expansion.

Under the administration's new forecast, gross domestic product, or GDP, will grow by 2.7 percent next year. Its old projection called for a stronger, 3.1 percent increase.

"The housing market decline has been more significant that we expected," Edward Lazear, chairman of the White House's Council of Economic Advisers, told reporters in a conference call. That more pronounced housing slump -- along with the expectation that problems will persist into next year -- was a big factor in the administration's downgrade of its economic growth forecast for 2008.

With the projection of slowing economic growth, the unemployment rate is projected to move up to 4.9 percent next year. That's up from a previous forecast of a 4.7 percent jobless rate but still would be considered fairly low by historical standards. The unemployment rate last year dipped to 4.6 percent, a six-year low.

Inflation, however, should improve.

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[originalpckelly]

1. Now we're really fucked. Bush has been touting the economy's strength...

so when they start revising things, you know that we're heading for another Great Depression.

[whistle]

2. How will that be possible given the economic meltdown, hyperinflation and financial collapse

...which will certainly happen by the 2nd quarter of 2008