'Remarkable' if US avoids 2008 recession - State Street

In its latest weekly report, State Street says many growth forecasts could yet prove “overly optimistic”, despite estimates continuing to be revised downward. “It seems that when the US sneezes, economists still catch colds,” the report states. State Street predicts more writedowns in residential mortgage-backed securities. “The first priority for banks will be to shore up their balance sheets and capital ratios,” it says. “Money will be cheaper if interest rates continue to fall. But banks are still likely to be very selective on who they lend to and on what terms.” While the liquidity...