How long does it take for “green shoots” to grow into a “soft patch”? For the U.S. economy, it has taken a little more than two years.

In his famous 60 Minutes interview on March 15, 2009, Federal Reserve Chairman Ben Bernanke popularized the phrase “green shoots” to describe the growing confidence in the post-crisis U.S. economy1. As the Fed’s second round of asset purchases of $600 billion (dubbed QE2) came to an end last week, “soft patch” became the new phrase du jour, describing the recent slowdown in economic activities. Even the June 22nd Federal Open Market Committee (FOMC) statement acknowledges that the recovery is progressing “more slowly than the Committee had expected.” For investors, this likely means that the Fed will be on hold longer than previously anticipated and interest rates may remain low for the foreseeable future.

Download article

Comments (0)

Subscribe to this comment's feed