Yes, and this is a massive political risk.
The deficit is getting large enough to stabilize the economy at high levels of unemployment.
With flat employment growth, and 2% productivity growth, real GDP grows at 2% and unemployment stays north of 8%.
And the equity markets are in a very good place with costs under control and sales stabilized and rising.
So the financial sector booms while the real economy stagnates.
And fuel prices move higher as well.
by Craig Torres
Feb 23 (Bloomberg) — Bernanke Offers Jobless Recovery as Humphrey-Hawkins Hopes Fade delivering semiannual testimony required in legislation written by the late lawmakers, will describe a U.S. economy returning to growth next year without generating many new jobs. Even with credit markets thawing, Fed officials see unemployment persisting at 8 percent or higher through the final three months of 2010.