Growth Prospects in U.S. Dim on Subprime Crisis

Bloomberg --- "Prospects for stronger U.S. growth in the second half of 2007 have dimmed as the housing recession deepens and businesses cut spending, according to economists surveyed this month by Bloomberg News."

"Subprime mortgage defaults and rising foreclosures raise the risk that the already wobbly housing market will contract even more. A decline in business investment and slower consumer spending will prompt the Federal Reserve to reduce interest rates sooner than previously anticipated, the survey showed."

"The subprime problem ``is a brand-new kind of shock,'' said Ethan Harris, chief U.S. economist at Lehman Brothers Holdings Inc. in New York. ``The data we've seen lately is consistent with an economy that's just not picking up.''