Top Fed Official Offers Dire Forecast, Says Economy Will Suffer For Years

A top Federal Reserve official warned Tuesday that one consequence of the Great Recession will be a "new normal" in which Americans have lower expectations for a better life.

In a speech, Federal Reserve Bank of Cleveland President and CEO Sandra Pianalto said that she expects "our journey out of this deep recession [to] be a slow one" because of the loss of skills jobless Americans have experienced as a result of prolonged unemployment, and the "heightened sense of caution" consumers and businesses are operating under as they navigate the worst economic downturn since the Great Depression.