Deep skepticism about Congress passing President Barack Obama’s $447 billion jobs package and fears that Greece could slip into default sparked a severe stock market selloff on Friday.
The Dow Jones Industrial Average closed down 304 points, or 2.69 percent, a reminder of how dangerously fragile the situation is despite government initiatives worldwide to stabilize the economy and fuel growth.
“There is only so much we can withstand before we move into a recession,” said Mesirow Financial chief economist Diane Swonk.
UBS analyst Drew Matus noted that the public is wary of piling on any debt, citing a recent poll by NBC and the Wall Street Journal.
“The President’s plan faces a key challenge from the public’s continued concern over the budget deficit,” he said. “As of the end of August, 56 percent of Americans want the president and Congress to focus on the deficit while only 38 percent want them to focus on boosting the economy.”