Purcell: Harvard thinkers say rough sailing ahead
Former Nashville Mayor Bill Purcell, now working out of an office at Tennessee State University’s Avon Williams downtown campus, didn’t hear good news about the U.S. economy during his time at Harvard University last fall. I had the opportunity to hear Purcell’s account of that news earlier today.
According to Purcell, Harvard President Larry Summers expects that the economy will “bottom out” in October and that the forecast for the future looks a lot more like 1991 than 2001. The recession in 2001 was rough, but 1991 was worse. Summers told a group of new mayors, including Nashville’s Karl Dean, that it would be “two years before you can do anything significant” because of the forthcoming economic stagnation.
While in Massachusetts, Purcell also heard economic historian Niall Ferguson say that the economy looks like 1930, the beginning of the Great Depression, most of all. Unlike in prior lean economic times, though, Ferguson expects that the third world (especially China and the Middle East) will sustain the first world (rather than the other way around). Ferguson anticipates a “fire sale” of U.S. assets because of the dollar’s low value. It may not be a depression we’re headed toward, but it could be a bumpy road.
February 13th, 2008 at 3:16 pm
Mr. Niall Ferguson, although a smart guy, is prone to rhetorical tsunamis.