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Showing posts from July 15, 2008

US economy to see painful correction

Business Times - 15 Jul 2008
America is now witness to a major shake-up that will affect more than just the 'mental' faculties of its businesses

By LEON HADAR
WASHINGTON CORRESPONDENT

FOR a while it seemed as though there were some signs of light at the end of the long economic tunnel. In Washington and on Wall Street, one could sense that both officials and investors were contemplating the possibility that the worst of the financial meltdown was perhaps behind us, that we were going to see indications of economic rebound around the corner, and that from now on, the Fed would have to focus on dealing with the expectations of inflation.

In fact, former Senator Phil Gramm, who is serving now as the top economic advisor to presumptive Republican presidential candidate John McCain, explained to reporters last week that the American economy was basically doing quite well. He said that the US country was not in a true recession but in a 'mental recession', adding that American…