In the midst of the deepest recession in the experience of most Americans, many professional forecasters are optimistically heading into the new year declaring that the worst may soon be over.
For this rosy scenario to play out, they are counting on the Obama administration and Congress to come through with a substantial public stimulus package, up to $1-trillion over two years. They say that will get the economy moving again in the face of persistently weak spending by consumers and businesses, not to mention banks that are reluctant to extend credit.
If the dominoes fall the right way, the economy should bottom out and start growing again in small steps by July, according to the December survey of 50 professional forecasters by Blue Chip Economic Indicators. Investors seemed to be in a similarly optimistic mood on Friday, bidding up stocks by about 3 percent.
But in the absence of that government stimulus, the grim economic headlines of 2008 will probably continue for some time, these forecasters acknowledge.
"Without this federal largess, the consensus forecast for 2009 is for the recession to continue through most of the year," said Randell Moore, executive editor of Blue Chip Economic Indicators, which conducts the monthly survey of forecasters.
Many economists are more pessimistic, of course. Nouriel Roubini at New York University, who called the 2008 market disaster correctly, wrote in a recent commentary on Bloomberg News that he foresees "a deep and protracted contraction lasting at least through the end of 2009."
Even in 2010, he added, the recovery may be so weak "that it will feel terrible even if the recession is technically over."
Roubini is not among the economists surveyed by Blue Chip Economic Indicators. These forecasters are typically employed by investment banks, trade associations and big corporations.
They base their forecasts on computer models that tend to see the U.S. economy as basically sound, even in the worst of times. That makes these forecasters generally a more optimistic lot than the likes of Roubini.
Their credibility suffered for it last year. They did not see a recession until late summer.