Special Report: Global Financial Crisis
NEW YORK, March 24 (Xinhua) -- Despite the worst
recession in decades, the U.S. economy will see a self-sustaining expansion
beginning in the fourth quarter of 2010, Moody's economist said at a panel
discussion organized by Dow Jones Indexes/STOXX Limited here Tuesday.
Augustine D. Faucher, director of macroeconomics for
Moody's Economy.com, said the U.S. stock market will bottom out shortly,
followed by home sales in the middle of this year and house prices by the end of
2009.
In 2010, a sustainable recovery is foreseeable in the
fourth quarter and by the year-end house prices will resume rising, based on
Faucher's recovery timeline.
"The United States is experiencing the most severe
economic downturn since the Great Depression, and the conditions are expected to
worsen before we start seeing signs of recovery," said Faucher, "The current
administration, however, has taken unprecedented actions to restart growth and
help rebuild the economy and financial market."
U.S. President Barack Obama signed a
787-billion-dollar economic stimulus bill into law on February 17. The sweeping
economic rescue package, the American Recovery and Reinvestment Act, is designed
to jolt the ailing U.S. economy by providing government spending and tax cuts
for both individuals and businesses.
Stability in the financial system, turn in the job
market and recovery in consumer confidence would be the signs to watch when the
economy is ready to expand again, Faucher said.
According to the research by Moody's Economy.com, the
U.S. jobless rate, which would top 12 percent in 2011 without the Obama
administration's stimulus plan, should peak halfway through 2010 at close to 10
percent.
Dow Jones Indexes data released on Tuesday's discussion showed that the market performance improved after Obama took office. The Dow Jones U.S. Banks Index saw an increase of nearly 1.5 percent in the first 64 days of Obama administration, compared with a 31.1percent plunge in the year-to-date change ending Monday.
