2008 Woodie Awards
What students need to know about a possible recession
Maurice M. McKiernan
Issue date: 1/30/08 Section: College News
Rumors of a possible U.S. economic recession have many students scrambling for answers: wanting verification, clarification and to know the implication it might have on their lives.
One such person is Greg Smith, a 25-year-old IUPUI sophomore studying English.
"It's disconcerting, to say the least," Smith says. "Finding a job after I graduate is a big concern. Graduating with a shiny new degree into a lackluster economy would be groan-worthy."
He is not alone in his concerns. Many students are wondering how this possible recession will affect them.
Someone with formal knowledge and an invested interest in this topic is Financial Advisor Nick Dickos, an Edward Jones employee who works in Noblesville and graduated from IUPUI in 2004 with a bachelor's degree in economics.
When asked about what the World Economic Forum in Switzerland is calling an inescapable U.S. recession, Dickos acts stoically and says, "The current status of the economy is: a lot of uncertainty; and recession predictions are just that - guesses. The difficult thing with a recession is that you can only detect it in hindsight, and I definitely do not have a crystal ball.
"For that reason - and others - I certainly do not believe that a recession is imminent," he says.
Former Chairman of the Federal Reserve System Alan Greenspan seems to agree with the thought that a U.S. recession is a real possibility - but definitely not looming. While speaking Thursday in Canada, Greenspan said, "The probability of recession is probably 50 percent or maybe slightly more."
Dickos further defends his stance by saying, "Our country has ways to tinker with the system that will help avoid a full-blown recession."
One of these ways to tinker with the system is by lowering the federal funds rate: A strategy that has recently been executed by the Federal Reserve Board on Jan. 22 when they announced that the current rate was dropped to 3.5 percent. This means that the interest rate consumers have to pay banks for a loan is lower, so, in theory, borrowing money becomes a more attractive option.
One such person is Greg Smith, a 25-year-old IUPUI sophomore studying English.
"It's disconcerting, to say the least," Smith says. "Finding a job after I graduate is a big concern. Graduating with a shiny new degree into a lackluster economy would be groan-worthy."
He is not alone in his concerns. Many students are wondering how this possible recession will affect them.
Someone with formal knowledge and an invested interest in this topic is Financial Advisor Nick Dickos, an Edward Jones employee who works in Noblesville and graduated from IUPUI in 2004 with a bachelor's degree in economics.
When asked about what the World Economic Forum in Switzerland is calling an inescapable U.S. recession, Dickos acts stoically and says, "The current status of the economy is: a lot of uncertainty; and recession predictions are just that - guesses. The difficult thing with a recession is that you can only detect it in hindsight, and I definitely do not have a crystal ball.
"For that reason - and others - I certainly do not believe that a recession is imminent," he says.
Former Chairman of the Federal Reserve System Alan Greenspan seems to agree with the thought that a U.S. recession is a real possibility - but definitely not looming. While speaking Thursday in Canada, Greenspan said, "The probability of recession is probably 50 percent or maybe slightly more."
Dickos further defends his stance by saying, "Our country has ways to tinker with the system that will help avoid a full-blown recession."
One of these ways to tinker with the system is by lowering the federal funds rate: A strategy that has recently been executed by the Federal Reserve Board on Jan. 22 when they announced that the current rate was dropped to 3.5 percent. This means that the interest rate consumers have to pay banks for a loan is lower, so, in theory, borrowing money becomes a more attractive option.
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