In fact, CBO Director Peter Orszag says the agency sees good growth in the economy despite the potholes. He says the "most likely scenario" is "continued economic growth."
However, Orszag says, the housing issues and problems in the subprime mortgage markets have created a yellow level of concern.
"The risk of a recession is clearly elevated," he says. At best, he says, the housing downturn could cost the economy about 1 point of the expected 2 to 3 percent projected growth, or "not enough to tip the economy into a recession."
But he says there are other elements to keep an eye on through the fall that could indicate a change in direction, including corporate spending and consumer confidence.
By Paul Bedard