The U.S Economy will most likely stretch into late 2009 as Fed official warned on Friday.

As consumers cut spending, economy has been going through a roller coaster for the past few months where many analysts believe the economy will continue to shrink through the rest of this year and into the next.

Recovery may be up in 2010 and 2011, but that does not mean that economy will not start to improve sooner as trio of crises, housing, credit and financial have badly damaged the economy.

Stocks moved higher as President-elect Barack Obama plans to name New York Federal Reserve President Timothy Geithner as Treasury secretary. The major indexes have jumped more than 5 percent, with the Dow Jones industrials surging nearly 500 points.

FDIC has agreed to guarantee up to $1.4 trillion in U.S. banks' debt for more than three years as part of the government's financial rescue plan.

A temporary insurance will be provided to banks that will guarantee the new debt in the even that consumers defaults. This will help banks to unfreeze their assets.

It is expected that over 9,000 banks, savings and loans will tap the FDIC's guarantee, which is in addition to the $250 billion program of buying shares directly from banks.

This program does not rely on taxpayers funds, because banks will charge special fees for the guarantee.

Gas prices have finally tumbled below $2, its lowest price since three years. It is impossible to tell how long the gas process might go, however, it is expected that lower fuel prices will remain at this level throughout out 2009.

The Federal Highway Administration reported this week that Americans drove 10.7 billion fewer miles in September than a year ago.

Crises are spreading to many different sectors as unemployment rises.  In California, unemployment jumped to 8.5 percent and the state's unemployment insurance fund that provides payments will reach deficit of $2.4 billion at the end of 2009.

Even cost of Holidays will turn into penny savings for many consumers. With retails sales expected to be lowered, many stores are opening their doors for Black Friday earlier this year with offered savings and coupons.

It is expected that consumers will stay away from credit cards and choose cash to pay for goods as many credit card companies start to lower limits on credit cards. Each time credit card company lowers credit limit, it hurts consumer credit score.