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Fed’s Williams Cuts Growth Forecast for Remainder of 2011

Federal Reserve Bank of San Francisco President John C. Williams cut his growth forecast for the rest of 2011, and said the economy probably won’t be able to expand enough to bring down a 9.1 percent jobless rate soon.

“The real threat is an economy that is at risk of stalling and the prospect of many years of very high unemployment, with potentially long-run negative consequences,” the regional bank chief said today in a speech in Seattle. While the Fed could take new steps to ease conditions, “these ‘treatments’ won’t make our economic problems go away and their costs and benefits must be carefully balanced.”