U.S. Seen Facing Back-to-Back Recessions in 2010

The Conference Board, a private research group, said in a report released Wednesday that although the U.S. economy is expected to return to growth later this fiscal year “back-to-back recessions, as occurred between 1980 and 1982 when the economy endured a systemic crisis rather than a regular recessionary period, are a potential risk at this time.”

“If the United States experiences a too rapid recovery, there may be a risk of another recession in 2010,” cautions Bart Van Ark vice president and chief economist of The Conference Board. “It may fuel expectations for a return to inflation, adding to the uncertainty concerning the pattern and path of economic recovery.” [via The Conference Board]

Van ark added, however, the likelihood of this scenario happening is small as deflation risks for the short and medium term are a greater threat, while massive governmental intervention through stimulus spending should stem further economic decline and ease the flow of job losses.

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