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Economy's Descent Accelerated In Oct.


The economy seemed to be settling into a mild recession until Lehman Bros.' Sept. 15 bankruptcy roiled global financial markets, sending the U.S. into a steeper descent.

Midwest factory activity in October fell at the sharpest pace in seven years, ISM-Chicago said Friday, far worse than official views. But virtually every piece of economic data — from manufacturing to jobs to consumer sentiment — has showed a sharp deterioration in the past several weeks.

A measure of future economic growth in the U.S. has fallen to a seven-year low, according to the Economic Cycle Research Institute. The annualized growth rate fell to a record-low -21.9% in the week ended Oct. 24.

The ECRI index's growth rate had weakened for most of 2008, consistent with a mild recession, says Lakshman Achuthan, ECRI's managing director.

"But when credit froze last month, the WLI accelerated downward to the lowest reading registered in its six-decade history," he said. "The outlook for the economy has darkened dramatically."...
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