Dueling headlines: Did Poole warn of a recession or not?

I saw a "zipper" headline on Bloomberg.com a few minutes ago that said that stocks in the U.S. declined as the "Fed's Poole Says Recession is a possibility". The linked story entitled "U.S. Stocks Fall; Home Depot, GM Retreat for 12 Straight Days" says "U.S. stocks dropped as a Federal Reserve official acknowledged there ``could be'' a recession..." The story goes on to admit that:

St. Louis Fed Bank President William Poole today said while there ``could be'' a recession, the central bank doesn't forecast one and the consensus estimate is for growth above 2.5 percent in the coming year.

Then over on MSNBC.com I see a story entitled "Fed's Poole: U.S. not heading into recession
Central bank official sees steady growth this year" says:

Saint Louis Federal Reserve President William Poole on Friday dismissed fears that the U.S. economy was heading into a recession.

"We do not see a recession coming," he told a business audience after delivering a speech here at the American Chamber of Commerce.

"Obviously, there could be a recession, and I see lots of news letters coming into my email inbox and I see some people forecasting a soft economy and other people forecasting surprising strength in demand. And so there are a lot of differences of opinion," he said.

"I would say that the consensus view, and this is not just my view, but the consensus view is real growth in the neighborhood of 3 percent... No guarantee. That is the outlook we have," he said.

Now I go back to Bloomberg and see that the zipper headline is gone and that their news page now has a story entitled "Poole Says Recession, While Possible, Isn't Forecast (Update3)" which says:

Federal Reserve Bank of St. Louis President William Poole said that while there ``could be a recession,'' one isn't likely, echoing comments this week by former Fed chairman Alan Greenspan.

``We do not see a recession coming,'' Poole said in answering a question after a speech in Santiago, Chile. ``Our commitment in the Federal Reserve is to do what is necessary to respond to events if they unfold and require a response,'' he told reporters later. ``But at this point it seems to me there is no, in my judgment, no pressing need for any immediate action.''

With such muddled media coverage, it should be no surprise that people jump to all manner of unwarranted conclusions.

Just to be crystal clear: Is it "possible" that there could be a recession in six months? Yes, it is possible... but it is always "possible", in any economy at any point in time that six months hence some expected or unexpected weakness could develop into a full-blown recession. Saying that a recession is "possible" is never new "news."

Is a recession at the end of the year likely? Neither Greenspan nor Poole nor any Fed official, nor most professional forecasters, nor me, are in any way saying that a recession is likely.

To be ultra, crystal clear: It is unlikely that there will be a recession at the end of the year.

What is very likely is that traders, pundits, the media, and other members of "The Volatility Crowd" will continue to see opportunities to attract attention and boost market volatility, and hence opportunities to make a quick buck, by highlighting any refererence to the "R" word (recession).

-- Jack Krupansky