Gloomy Greenspan warns of recession for US economy

· Weak housing market puts brake on retail spending
· New Fed chairman may be forced to cut interest rates

Larry Elliott and Ashley Seager
Saturday May 12, 2007
The Guardian

Further gloom gathered over the US economy yesterday as retail sales lurched lower while former Federal Reserve chairman Alan Greenspan issued a fresh warning that the world's largest economy could be heading for recession.

New figures showed retail sales in the US unexpectedly tumbled last month, hit by a double whammy of higher petrol prices and a crumbling housing market.