Industry NewsMarkets & Economy

Downturn is not the ‘new normal’

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Job losses, tight lending standards and miserly consumer spending aren't the "new normal" and the U.S. isn't headed for a "lost decade," economists with the UCLA Anderson Forecast said in a report released today.But the economy will grow slowly next year and unemployment will remain high, despite promising signs that housing is "finally on the road to recovery," the report said.Foreclosures continue to rise, and the report estimates that 23 percent of homes with a mortgage are underwater -- meaning their owners owe more than their homes are worth. But low mortgage rates and pent-up demand are expected to boost housing starts by 48 percent next year, to 850,000 units."If we looked only at housing, we might be thinking a powerful recovery is just around the corner," said Edward Leamer, director of the UCLA Anderson Forecast, in an essay accompanying the fourth-quarter report,"The Shape of Recoveries Past and the Shape of Recoveries Present.&...