Feldstein Warns on a Possible Double Dip Recession

My favorite mainstream economist is at it again. He is warning of a potential double-dip recession. He told Maria Bartiromo that:

...the current economic upturn is being “force fed” by government stimulus and not driven by the usual business cycle in which growth begets more growth. At some point, the stimulus programs have to end – be it Cash for Clunkers (which is already over), tax breaks for home purchases or historically low interest rates... Feldstein believes there will also be political pressure to keep rates low because unemployment is expected to remain a problem in the early stages of recovery. However, keeping rates too low for too long would lead to inflation.

Other reasons Feldstein sees potential danger include...the burgeoning federal budget deficit with little talk of how to bring it back to more normal levels, and “the real disaster” looming in commercial real estate.