Double-dip recession possible

A Portland money manager shares his concerns about the state of the economy.

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Portland money manager Mick Elfers says he has doubts about the near-term health of the nation’s economy.

In a Q&A with The Oregonian, Elfers says a double-dip recession is “a distinct probability.”

Warren Buffett has said that in the short run, the market acts like a voting machine, but in the long run, it is a weighing machine. Much of the rally we have seen since March has been based on the relief that we have stabilized our global economic system. Investors are relieved that the crisis seems to have passed. So in the short run, people are casting very positive votes about their emotional response to the market.

But eventually, there will need to be evidence of economic rebound that can be weighed, measured if you will. We have lost millions of jobs, one in eight Americans are late on their house payment or in foreclosure and on food stamps. The government has stepped in to help people in hopes that the economy will start growing again on its own, but thus far, all of the positive news is coming from government spending and eventually, that will run out.

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