|
COPYRIGHT 2002 The Orlando Sentinel
Byline: Susan Strother Clarke
Jun. 30--Corporate scandal could be the sucker punch that sends the economy reeling.
The business bombshells that have rocked Wall Street could slow the nation's recovery and shove the country back into recession, some experts fear.
The latest disaster occurred last week when WorldCom Inc., the once high-flying telecommunications giant, stunned the markets by announcing it hid losses by misstating $3.8 billion in expenses.
Most troubling are the ripple effects of disclosures: The nation's financial health is closely tied to stocks. U.S. households already have lost a collective $4 trillion in the two-year bear market, with much of that incurred by average Americans with 401(k)s and other retirement plans.
There's only so much people will be willing to lose before they stop spending -- and reverse the economic gains of recent months, experts said.
"Is this sequence of events big enough . . . to put us in another recession? My direct answer is yes, unfortunately," said David Scott, an economist at the University of...
Read the full article for free courtesy of your local library.
|
Bookmark this article
Print this article
Link to this article
Email this article
Digg It!
Add to del.icio.us
RSS
