Harvard Warns Of "Double Dip" Economy

Harvard University professor Martin Feldstein said this in an e-mail to Bloomberg.

“The danger remains of a serious slowdown after this and a possible double dip of the economy in 2010.”

The economy grew in the third quarter for the first time in more than a year, propelled by emergency programs to boost buying of cars and homes, according to Commerce Department figures released yesterday. Policy makers are betting those temporary measures will pave the way to a self-sustaining expansion as companies hire and consumers increase spending.

The risk is that the biggest government intrusion into the economy since World War II will leave the U.S. saddled with trillions of dollars of debt and not much to show for it. The worst financial crisis since the Great Depression may have shaken companies and consumers so much that their spending won’t be enough to replace federal support.