Caterpillar, Inc. joins other large corps warning of recession  
Saturday, October 20th, 2007

Caterpillar, Inc., the U.S.-based manufacturer of heavy equipment, generators, and engines for trucks and school buses, joined a growing list of large U.S. corporations that are issuing strong warnings about the current state of the economy in the United States.

On Friday, Caterpillar issued a financial report, stating global growth is promising, but that the U.S. economy is "near to, or even in, recession."

"We continue to see remarkable growth outside of the United States when particular strength in key industries like mining, oil and gas, electric power and marine engines," said Jim Owens, Chief Executive of Caterpillar.

But the Federal Reserve (the central banking system of the U.S.), he said, needs to make further cuts in interest rates to "move economic growth back to nearer the economy's potential."

Caterpillar Vice President and Cat Financial President Kent M. Adams said, "Continued growth in our global business has compensated for the weaker U.S. housing industry."

"So we've put [the chance of a] recession in probably a 50/50 type range," said Caterpillar's Chief Financial Officer, Dave Burritt.

Other recent warnings of recession:

"I don't know if there's any of us out here that would hold a lot of optimism in the immediate future for (U.S.) housing," said 3M Chief Executive George Buckley.

"We've got a great product and a great company that up till now [has] been recession-resistant," said Harley CEO Jim Ziemer.  "But, we never said it would be that forever.  And at least in the United States, we're feeling some of the impact."

The Financial Service Forum, a policy group made up of CEO's of 20 of the world's largest financial institutions - including Citgroup, Inc., Morgan Stanley, Golman Sachs Group, and MetLife, Inc. - predicted on Wednesday a 37% chance of a U.S. economic recession in the next 12 months.

   

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