Washington, Atlanta, Montgomery; All Say Increased Signs of Recession - WSFA.com Montgomery Alabama news.

Washington, Atlanta, Montgomery; All Say Increased Signs of Recession

There's a growing momentum in opinion from several highly placed economists and bankers, all saying that America's economy is sliding toward a recession.

The financial markets took another hit Thursday, and for the first time, the Federal Reserve chairman, the President - even Alabama's governor - began talking about a plan to get money rolling again especially for the middle class.

Nothing's written in stone yet, but the debate is expected to be fierce.

The signs are almost everywhere. Housing starts are at the lowest in 27 years, Christmas sales were ok, but nothing to write home about, and despite a strong 2007, investors in the stock market are taking their money and running.

With the stock markets down 14 percent in just three months, and inflation threatening, the nation's top banker issued a big call today.

"We need to have long term financial responsibility," said Fed Chairman Ben Bernanke.

The president has a plan to pump up the volume, which would include making his tax cuts permanent and putting more cash in consumer pockets so they can spend it.

At the same time, the White House staff is trying to keep consumers calm.

"We're dealing with short term concerns with the economy," said spokesman Tony Fratto. "The headwinds that we're dealing with right now are things that we see over the next coming quarters. So we do want to try to pass something quickly."

Alabama officials say we're in better shape than most to fight off a recession, with major industrial development going on and an expected boom in hiring here.

Governor Riley pointed out Alabama's economy is expected to grow about 2 percent in 2008, and a visiting senior federal bank official noted our recent trends.

"In particular, Tennessee and Alabama have done very well," said Dennis Lockhard, President of the Atlanta Federal Reserve Banks.  "Taken as a whole, the southeast has experienced solid growth in the last few years."

But with mortgages melting down across the country and credit in short supply, and with companies like Merrill Lynch posting multibillion dollar losses, some say whatever government might do could be too little, too late. 

Among them, Chairman Bernanke. 

"Those who want to have lower taxes  - and low taxes have many benefits - also need to support a very disciplined spending side as well," he said.

Governor Riley says he wants the state legislature to approve another tax relief plan for lower and middle income families in Alabama.

He says he'll present an idea at the State of the State address in three weeks.

As for any national programs, the president's spokesman says he has no deadline.

Reporter: Chris Holmes

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