Dr. Ed. Yardeni of the investment banking firm Deutsche Morgan Grenfell has reversed his previous bullish stance of June and now says there could be a recession in 2000. This was reported in the NIGHTLY BUSINESS REPORT (Sept. 15).
For comparison, here is Yardeni's position, quoted in the San Francisco EXAMINER (June 19, 1997).
"First, economist Edward Yardeni declared to the world that the Dow Jones industrial average, 6,448 points at the beginning of the year, will rise to 15,000 by the year 2005.
"Wildly bullish" trends are at work, he said in his commentary for Deutsche Morgan Grenfell securities. "The best is still to come over the next 10 to 50 years."
Now, he says:
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And So I think it's-it could shave in 1998 may be a half percentage point off of economic growth. In 1999, it should shave a percentage point up a growth but we'll still be growing. So in other words, in 1999 instead of growing at 3 or 4 percent, may be we will be growing at 2 percent. In the 2000, again, it's a risk that we will have a recession. It's not inevitable. But if we do, then we can have GDP falling by 1 or 2 percent during that year assuming a mild global recession.