Ingram Comments on Economy
Bookmark & ShareAugust 15, 2004
Source: Minneapolis Star-Tribune
With inflation outpacing wage growth and the job market on a month-to-month roller coaster, analysts say the economy is in danger of stalling if businesses don't begin boosting capital investment and hiring more workers. The Federal Reserve, in raising interest rates last week, said all the indicators suggest strong growth lies ahead. But as the recent weak jobs reports have demonstrated, a full recovery in business spending and hiring, widely anticipated each of the past three years, has yet to take hold. And that has economists puzzled. In a recession, "investment spending tends to go down faster than consumption spending," said BETH INGRAM, chairwoman of the economics department at the University of Iowa. "As the recession ends, the investment spending picks up. That hasn't happened yet, which is a little bit surprising."
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