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Forecast: Perfect storm of financial problems, but no recession

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Fear of imminent economic recession may be a self-fulfilling prophecy, according to the latest Anderson Forecast report by University of California, Los Angeles forecasters. While the report by Edward Leamer, director for the forecast, clings to earlier predictions that the U.S. economy will avoid a recession in the short term, it also details the dangers that are stressing consumers and challenging the economy. Leamer referred to the "financial shadow" that can sometimes loom disproportionately large in consumers' minds and negatively impact spending. This shadow, he stated in his report, has the potential to cause "recession depression," or fears of a recession. And if that fear is great enough, and consumers "spend time in their beds instead of in the malls," then it could become "recession reality," he said in the report. "The no-recession view hinges very critically on consumer spending and the negative wealth effect ...