The Global Economy -- Time for a Second Recession?

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Reviving the U.S. economy is proving to be trickier than anyone thought. There are growing concerns that the global economy may soon dip back into recession.

Americans are extremely cautious, uncertain about the fragile economy. And policy makers aren't so sure how to get it back on track sooner rather than later.

Federal Reserve officials want to avoid deflation, or widespread falling prices, because of dwindling demand.

Deflation has already set in with oil prices. Gas prices typically retreat after Labor Day, but oil has fallen more than $9 a barrel due to weak demand during what is usually the busy summer travel season.

Investors are nervous about a global slowdown. Economic indicators -- housing and earnings reports, stubbornly high unemployment -- have some worried that the world economy could even a slip back into recession.

The dollar also continues to lose ground. It fell to a 15-year low against the Japanese yen.

Last week, President Barack Obama said the economy has turned the corner, but not as fast as he had hoped. But his administration still claims things are better now than before.

"All this great economic activity right here on this line with suppliers humming next door, I can't help but think of the contrast between the dark things that this economy was showing when we took office in January 2009," said Vice President Joe Biden.

More economic forecasters have started to acknowledge that a double-dip recession is possible, though not likely. Instead, most expect growth to slow down significantly, until consumers regain confidence to start spending and businesses have the confidence to start hiring.

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