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For months, the global downturn has been compared to the worst economic slumps of the past century: Japan's lost decade, the drawn-out recession of 1982 and even the Great Depression.

Now, with a forecast for 2010 that sees Canada's economy growing at a blistering, almost 5-per-cent clip for much of year and averaging a healthy 3.8 per cent for the year, Bank of Canada Governor Mark Carney is calling into question the widely accepted view that recovery will take many quarters of sluggish growth.

Mr. Carney's forecast for a dramatic economic rebound in Canada next year contrasts with the consensus of private sector economists of 2.3-per-cent growth that year and has prompted incredulity among observers.

But that doesn't mean the central bank is wrong, economists said. Rather, it likely means the bank assumes that everything will go right for Canada in the coming year.

The forecast hinges on federal and provincial spending, stimulus packages around the world driving up commodity prices, and credit conditions easing. In addition, the U.S. economy would need to bottom out and start to pick up so that demand for Canadian goods such as cars and lumber improves.

“Things have to line up pretty well for all this to happen,” commented David Wolf, chief economist at Merrill Lynch Canada. He is forecasting a milder contraction than the bank for this quarter, of 2.9 per cent annualized.

But Mr. Wolf forecasts a much slower recovery, a 2.2-per-cent expansion next year.

For the short term, Mr. Carney is more pessimistic than most, forecasting a deep contraction of 4.8 per cent this quarter, at annualized rates. But the forecast of a strong rebound attracted greater controversy.

“We don't know what to make of this forecast,” said Dale Orr, chief economist at IHS Global Insight Canada, which has one of the most sophisticated forecasting models in the country.

Mr. Orr had hoped to see a better explanation of what the bank assumed in order to see such strong growth next year, especially since its forecast for the rest of the world is for weak growth. But he was left with many unanswered questions.

“I give the bank really low marks on that effort,” he said.

Mr. Wolf argues that the bank's forecast for 2010 is more wishful thinking than a picture of what Mr. Carney believes will actually transpire. By posting such a strong rebound, the bank is forecasting what needs to happen in order for inflation to return to the central bank's target of 2 per cent. And it is indicating that, together with stimulus from the federal government, policy makers can actually make that kind of growth come about, Mr. Wolf said.

“What they're saying is, they can make policy such that they can get that kind of recovery.”

Still, he believes the chances of growth being that strong are very small, and the overwhelming risk is that growth will be much lower.

The central bank is not alone, however, in seeing a strong rebound. The Conference Board of Canada has a forecast for 3.6 per cent, and it will likely revise it higher since it is clear that next week's budget will be fatter than the Conference Board had assumed initially, said Pedro Antunes, director of forecasting.

Like the central bank, his model assumes that when the recovery comes, the slack that has built up in the economy will be taken up quickly. The past two recessions have shown us that, the bank argues.

The Conference Board also believes that as the U.S. recovers, Canada will recover more quickly because a revival in U.S. demand will disproportionately boost purchases of Canada's cars and lumber. Americans are not buying enough cars to replace their old ones, and housing demand is poised to rebound quickly because the U.S. population is growing, Mr. Antunes said.

Like Mr. Carney, the Conference Board believes commodity prices will rise, and Canada will benefit immediately.

That's not the conventional thinking. Generally, it's believed that since Canada exports only slightly more energy than it imports, higher prices are thought to substantially benefit the country's income only over the long term.

What if the Bank of Canada is wrong?

Even if Mr. Carney's forecast proves to be too optimistic, he can always change his mind, and ease monetary policy accordingly, economists say.

But Mr. Orr believes there are more profound implications. If Finance Minister Jim Flaherty designs his budget to assume a nasty 2009 but a steaming-hot 2010, as Mr. Carney's forecast suggests, then his stimulus will be set up to hit the economy now, and be withdrawn quickly later.

The hundreds of thousands people poised to lose their jobs and the firms forced to declare bankruptcy may need stimulus later, too, Mr. Orr says.

“The [continuing] stimulus could have prevented unemployment,” he said. “That's the implications for Main Street.”