Bouncing along the bottom

The Federal Reserve announced today that it believes that while the economy will continue to grow over the next two years, it will do so at a very slow rate.  They've dropped their estimates for economic growth to about 1.6 percent this year and about 2.5 percent next year.  Unemployment is expected to stay above 8 percent for the foreseeable future.

The Fed has pretty much shot its bolt on anything other than psychological help anyway.  With interest rates already at or near zero, there's really nothing they can do to give an incentive to the private sector to produce and consume.   Look for Bernanke and friends to keep doing their rhetorical human pyramids and backflips for the next few quarters, or at least until the people who actually produce figure out a way to create jobs and make money without their help.

Remember, folks, these are the government's economic cheerleaders talking here.  Part of their job is to help boost confidence in the economy and health of the nation.  They're probably feeling heat from the rest of the government to give as rosy a picture as they can.  If they're expecting the economy to stay sluggish for at least the next couple of years, we're probably boned.