This is a good news/bad news post. I'll start with the good news, because we can all use some. Federal Reserve Chairman Ben S. Bernanke told "60 Minutes" yesterday that the recession will probably end this year and the U.S. economy may grow in 2010. CBS correspondent Scott Pelley asked: "Mr. Chairman, I'm gonna start with a question that everyone wants me to ask: when does this end?" Bernanke replied: "It depends a lot on the financial system. The lesson of history is that you do not get a sustained economic recovery as long as the financial system is in crisis. We've seen some progress in the financial markets, absolutely. But until we get that stabilized and working normally, we're not gonna see recovery. But we do have a plan. We're working on it. And I do think that we will get it stabilized, and we'll see the recession coming to an end probably this year. We'll see recovery beginning next year. And it will pick up steam over time." How about unemployment? Will we see any improvement? "Well, it's hard to forecast exactly where we're going. Unemployment is rising. Job losses are still very severe. And no doubt, the unemployment rate's gonna go higher than it is. But I think, again, that if we do succeed in stabilizing the financial system, that we'll begin to see a slower pace of decline, and eventually, a stabilization that will set the basis for a recovery," Bernanke said. It is nice to get some mildly positive news for a change. That message wasn't anything to jump up and down about, but at least it suggests things will be getting better soon. Now the bad news. None of these stories are related, except that they're all the result of the credit meltdown:
- Visteon Corp. expects to get "going concern" language from its auditors, because of auto industry conditions and the company's cash condition, according to this story from Automotive News today.
- Compounder and sheet extruder Spartech Corp. revealed today that it will temporarily reduce the base salaries of top five executives. According to this St. Louis Post-Dispatch story, Spartech President and Chief Executive Myles Odaniell's base salary of $545,000 has been reduced 10 percent. Salaries for the other four top executives are reduced 8 percent.
- Sturgis, Mich.-based blow molder Penguin LLC is laying off about 150 of its 250 employees because of the economic downturn and nonrenewal of a contract with a major customer, according to this Kalamazoo Gazette story.
- Jones Plastic & Engineering will eliminate its third shift at the end of the month because of shrinking sales, according to this story from Manufacturing & Technology. The item notes that the Jeffersontown, Ky., custom injection molder "has become a captive molder that serves one primary customer," because of dwindling work.