NEW YORK, March 18: Majority of Americans think the country is in a recession, a USA Today/Gallup Poll said on Tuesday after the stock market crisis which was triggered by the collapse of Bear Stearns financial group.

The Gallup poll shows, crisis of confidence that economists say could make the economy worse.An economic expert observed in Bloomberg news that the cost of faltering American leadership is growing as quickly as you can say Bear Stearns.

“And the stakes in the US election campaign increase with every dismal twist of the economic cycle.”

As the US Federal Reserve expanded credit to securities dealers and

President Bush said his administration had taken “strong and decisive action,” the poll revealed pessimism about the economy’s direction.

Seventy-six percent of those polled said the economy is in recession, compared to 22 per cent who said it’s not. Not since September 1992, two months before President George H.W. Bush lost re-election, have so many Americans said the economy was in such bad shape.“Recessions are almost always crises of confidence, and that’s what we’re having right now,” said David Wyss, chief economist at Standard & Poor’s told USA Today.

Asked if the nation could slip into a depression lasting several years, 59 per cent said it was likely, and 79 per cent said they were worried about it. A recession is an economic downturn that usually lasts at least six months; a depression is longer, deeper and more broadly dispersed.

The poll of 1,025 adults was completed on Sunday, the day the Federal Reserve financially backed JPMorgan Chase’s buyout of venerable investment bank Bear Stearns. It was one in a series of actions meant to stabilise world financial markets and give investors renewed confidence, including a cut in the interest rate on direct loans to banks and a new line of credit for securities dealers.

“When people experience higher gasoline prices, higher heating costs, fewer employment opportunities, housing prices going down … then the common sense conclusion is things aren’t very good” Brian Bethune of economic forecaster Global Insight said their pessimism “creates more problems,” he added.

Jared Bernstein, senior economist at the liberal Economic Policy Institute, told USA Today that a recession can become a self-fulfilling prophesy: “If folks don’t feel confident enough to make that purchase, to take the vacation, even to go out to eat, that obviously reverberates negatively throughout the economy.”To counter that cycle, President Bush briefly invited reporters into his normally private policy meeting with economic advisers Monday. “One thing is for certain, we’re in challenging times,” Bush said. But he said that the government “is on top of the situation,” adding, “in the long run, our economy is going to be fine.”

After meeting a second time with Bush on Monday, Treasury Secretary Henry Paulson told reporters that the administration is seeking to take actions “that are going to increase confidence in our economy.”

Meanwhile, Former Federal Reserve chairman Alan Greenspan sounded more downbeat. Today’s financial problems could likely be seen as “the most wrenching since the end of the second world war,” Greenspan wrote in the Financial Times on Monday.Democratic presidential candidates Barack Obama and Hillary Rodham Clinton urged greater action. Obama, campaigning in Pennsylvania, said the economy “is heading toward recession. We probably already are in one.” He said “we must focus on what we can do to restore the public’s confidence in the market.”

Ms Clinton was more cautious. Calling it a time of “stress and uncertainty,” she said there was “urgency” to continue monetary policies like those taken on Sunday. “We are in the soup, and we better get ourselves out of it before the consequences get drastic,” Clinton said in Washington.