“The United States appears to have slipped into an economic funk that analysts say bears a strong resemblance to the weak recovery of the early 1990’s,” writes David Leonhardt in today’s New York Times.

“With few companies adding jobs and Americans’ net worth having dropped more than 20 percent in the last two years, the coming months are likely to feel like a slump even if the economy is gradually improving.”

“As the country continues to work off the excesses of the 1990’s boom, including deceptive corporate accounting and large amounts of debt, economists expect both businesses and consumers to increase their spending only modestly. The possibility of further corporate scandals or an oil disruption in the Middle East heightens the uncertainty.”

” ‘The economy started to look like it was in the beginnings of a normal recovery, but then it seemed to grind to a halt in July,’ said Ethan Harris, one of two chief economists at Lehman Brothers. ‘It’s got to make you very nervous.’ “

“Federal Reserve governors are scheduled to meet tomorrow in Washington, still struggling to lift growth amid criticism that they — particularly Alan Greenspan, the chairman — may have overestimated the strength of the long boom.”

“Most economists do not expect the Fed to cut interest rates from their exceptionally low levels this week — or even this year unless new economic problems emerge. But the Fed may signal its intentions when it meets, and there is considerable debate about what it should do, possibly as insurance against a downturn. Economists at Morgan Stanley said Friday that they expected the Fed to reduce its benchmark interest rate, perhaps to 1.25 percent from 1.75 percent, to encourage new spending, and investors bid up stocks last week partly in hopes of a cut.”

“On the day that the Fed meets, President Bush will convene an economic summit in Waco, Tex., where policy makers, executives, economists and others will discuss strategies for improving growth. The summit will in some ways resemble a 1992 gathering that Bill Clinton held in Little Rock, Ark., during the last so-called jobless recovery, which helped him win the White House from President George H. W. Bush.”