Bailout backfire?

The World Economic Forum took a grim view of prospects for the world economy this year in a report released Tuesday,warning that government spending to counter the financial crisis could backfire. The report concluded that the economic outlook for 2009 is a grim one for most economies. The leaders,experts and financial services firms that took part in the report pointed to ongoing volatility in markets,a liquidity shortage,rising unemployment and record lows in business and consumer confidence. But the crux of the report was a prediction that massive government spending to support ailing financial institutions could sow the seeds of more problems in the future.