Minnesota Fed predicts slow recovery in 2010

So said the Federal Reserve Bank of Minneapolis last week. Toby Madden, the Minneapolis Fed Regional Economist, painted a rosy picture for the next twelve months during a press conference.

Hear that?! The recession! Over!

Or not.

These same forecasters have time and again offered public predictions that, in any other field (excepting for meteorology) would have blown their credibility. In late 2007, for instance, Madden and regional central bankers underestimated the economy's structural imbalances to an almost comical degree. To be fair, they forecast a 2008 marked by slow economic growth and a small uptick in the state unemployment rate. But they also denied that a run-of-the-mill recession--let alone one of the most spectacular financial meltdowns in the history of human folly--was on the immediate horizon. Take a look at this Dec. 19 Strib article. Or, if you're strapped for time, just savor the nutgraph:

"The central bank forecasters see no recession in sight but describe a year to forget before it begins."

This prediction was made a month after the officially recognized start-date of the current downturn. So despite the optimism currently emanating from the Minnesota Federal Reserve, we're not popping the champagne quite yet.