Monday, 25 Jun 2012 12:20 PM

By Dan Weil

Gluskin Sheff chief economist David Rosenberg has remained bearish on the U.S. economy since the financial crisis ended in 2009, and now he puts it in stark terms.

"We are living in a modern day depression," Rosenberg tells Yahoo. “Never in the post-World War II experience have I seen a recovery languish as badly as this one.”

The Fed's expansionary fiscal and monetary policy has done little to help, he says.

“Despite over three years of zero percent interest rates, a Fed balance sheet pregnant with triplets, and four years of trillion dollar deficits, the best we could do this cycle was average more than 2 percent growth.”

So how does Rosenberg evaluate this result? “That’s pathetic,” he says.

“Normally three years into the recovery, you’re averaging well over 5 percent growth with far less government support.”

The economy expanded 1.9 percent in the first quarter, slowing from 3 percent in the fourth quarter.

The economy will take several years – perhaps three to four – to truly recover, Rosenberg says.

“A depression is all about wealth destruction and credit contraction. That’s the cycle we’re still working through now.”

Rosenberg sees government intervention slowing the recovery process, and many economists agree.

But others credit the Federal Reserve’s massive easing for keeping the economy out of a true depression and view some of the deficit spending as positive for the economy.

Indeed, some of these economists advocate more fiscal and monetary easing.

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