If you just looked at the stock market, you might think the threat of recession was gone and forgotten. Since hitting a low on Apr. 4, the Standard & Poor's 500-stock index is up 14%. One reason for the renewed confidence, of course, is the better-than-expected first-quarter economic data released on Apr. 27, which quelled fears of a recession. According to the government, gross domestic product grew at a 2% rate, while real consumer spending was up a solid 3.1%. Moreover, the housing market still appears to be strong. Indeed, even the May 4 announcement by the Bureau of Labor Statistics of a rise in the unemployment rate, to 4.5%, didn't seem to dampen investor enthusiasm. Wall Street appears to be counting on more rate cuts from the Federal Reserve and President George W. Bush's tax cut plan to bail out the economy.
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