Labor/Economy

The nonpartisan Congressional Budget Office said that the short-term outlook for the U.S. budget deficit isn’t particularly good, but the longer-range forecast is better than expected. At 8.5 percent of GDP, the $1.3 trillion budget deficit that the CBO is projecting for 2011 will be the third-largest shortfall in the past 65 years, exceeded only by the deficits of the preceding two years.

The economic tumult of spring and summer have apparently discouraged Americans from buying new homes. According to the U.S. Census Bureau on Tuesday, new home sales in July sold at an annualized rate of 298,000, a drop of 0.7 percent from June.

The Mortgage Bankers Association reported on Monday that the percentage of U.S. households delinquent on their mortgages rose by a slight 12 basis points during the second quarter of 2011 to 8.44 percent compared with the first quarter.

A new recession or not? The numbers and the opinions keep pouring in. Last week the Philadelphia Federal Reserve published a survey of regional manufacturers that showed a distinct regional slowdown in the main bright spot of the economy in recent years, namely manufacturing.

“Roller coaster” might not be a fitting metaphor for Wall Street during this nervous summer of 2011. Yo-yo might be better.

Wall Street seems determined to panic like it’s 2008, no matter what the bearded one says, so the roller-coaster ride was back downward on Wednesday, pretty much erasing Tuesday’s gains, which had mostly erased Monday’s losses.

The Federal Open Market Committee’s (FOMC) statement on Tuesday, which much of the investing world had been anticipating (between moments of headless-chicken panic), started off bland enough, per Federal Reserve custom.

Observers, pundits and prognosticators weren’t quite sure what investors would do after Friday’s unprecedented Standard & Poor’s downgrade of U.S. sovereign debt.