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Is the Economy Losing Steam?

Say "recession" around most homebased entrepreneurs, and they break out in a sweat. But things aren't as bad as they seem.

This story appears in the February 2001 issue of HomeOfficeMag.com.

If you asked a fellow homebased business owner what the largest threat to his business is, he might say a recession. A sustained economic downturn, he'd say, will cause companies to turn off the money spigot, lay off employees, and hunker down until the financial clouds part on the economy and skies are sunny again.

Maybe...but more likely, maybe not. It's important to note that we're not in a recession, so worrying about it is a waste of time. In fact, the economy may even grow in 2001, albeit slowly. According to Merrill Lynch chief economist Bruce Steinberg, the global gross domestic product (GDP) is expected to rise to 3.2 percent, which is down from 2000 but stronger than in 1998 and 1999. In addition, the Fed has cut the federal funds rate to 5.5 percent, making the risk of recession low.

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