Nightly News | January 01, 2011
KATE SNOW, anchor: No matter what the political debate is in Washington this January, Americans don't really need lawmakers to tell them that the economy was sluggish in 2010 . Unemployment has stubbornly hovered around 10 percent. But what is the forecast for 2011 ? NBC 's John Yang takes a look.
JOHN YANG reporting: The government's final economic report of 2010 had a glimmer of good news. First-time claims for unemployment benefits dropped to the lowest level in more than two years. That and the best holiday shopping season in years have raised hopes for 2011 .
SUE HERERA reporting: I think the economy is going to slowly and steadily improve, and I think that it will be a much better economic year than 2010 was.
YANG: But not all consumers agree. This week a widely watched measure of consumer confidence dropped.
Unidentified Woman #1: I do not see things getting better in the short term, and for me it's scary.
YANG: There are lots of reasons for concern. After showing signs of recovery, home prices are sinking again. It's raising fears of a double-dip housing recession. Meanwhile, other prices are going up.
Ms. PATTY EDWARDS (Trutina Financial): We've got inflation coming, and that is going to be a problem for the consumer.
YANG: It's already showing up at the gas pump. Nationwide, the average price for a gallon of regular is above $3, a level not seen since 2008 and up nearly 21 cents in just the past month.
Unidentified Woman #2: We'll do all the trips in one. If I'm going to go to the supermarket, then go to the gym, and then pick somebody up, then we come back home.
YANG: Higher fuel costs mean higher transportation costs, and that ripples through the economy. At the grocery store, the government predicts higher inflation in the first six months of 2011 . Pork is already up 12.9 percent over last year, beef up 6.2 percent, dairy up 3.8 percent.
Unidentified Man: Before you weren't paying attention to, you know, a can of beans that you would buy, and now you are.
YANG: As old worries about the economy continue into the new