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Would Second Stimulus Restore Boom Times?

If one is good then two must be better. Chatter is growing in Washington about a second stimulus and whether even more spending will restore our formerly robust economy.

On Tuesday House Majority Leader Steny Hoyer said leaders should be open to the possibility of a second stimulus package to further boost the economy, which is still hemorrhaging jobs.

Hoyer told reporters although it was too early to say whether the unprecedented $787 billion spending package was working, it was essential to keep the possibility of a second stimulus on the table. "I think we need to be open to whether we need additional action," he said.

Largely driving those comments are growing unemployment figures. Last month employers shed some 467,000 jobs, which sent the unemployment rate up to 9.5 percent, the highest in nearly 26 years.

And the jobs outlook is expected to get worse in coming months, with many economists predicting it will surge past 10 percent.

Although the rate of job losses is slowing, "it's not where it ought to be," Hoyer added. Some areas of the economy are still in trouble, he said, "housing being the leading sector."

However Hoyer may be going down the wrong road.

According to Moody’s economist Mark Zandi, the bleak unemployment picture may have more to do with bad forecasting that anything else. He tells Fast Money “The forecasts at the beginning of the year were overly optimistic. In fact if job losses abate by this time next year then the stimulus was a success.”

And earlier Laura D'Andrea Tyson, an economic adviser to President Obama, said much the same. "The stimulus is performing close to expectations, but not in timing." In other words, the economy is in a far worse shape than the administration had estimated.

What do you think? We want to know!

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> US Must Be Open To Second Stimulus

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