The Fed just “sharply downgraded” projections for U.S. economic performance for 2009, predicting that the economy will shrink and the unemployment rate will surge even higher (possibly to between 8.5 and 8.8%, as compared to older forecasts for between 7.1 and 7.6%).
The Fed didn’t stop there, though. They also believe the economy will contract this year between 0.5 and 1.3%, as compared to old forecasts for shrinkage of between 0.2 and 1.1%.
And all of this is thanks to housing, credit and financial chaos.
Oh, and the billions of dollars we lent to General Motors and Chrysler wasn’t enough. The companies, which received $17.4 billion to date, just submitted a request for $39 billion. The request came with plans to cut thousands of jobs. GM, for instance, announced it would cut 47,000 jobs globally by year end. Chrysler said it would cut another 3,000 jobs.
Suddenly, I feel sick…
