Instead of a roaring recovery, the U.S. economy is going to experience a recovery closer to a whisper this year, analysts at Prudential’s annual Market and Retirement Outlook panel discussion predicted Tuesday.

While a deep recession is normally followed by growth somewhere in the 8% range, the U.S. economy will see something closer to 2% or 2.5% annualized growth, Robert Tipp, chief investment strategist for Prudential Fixed Income Management, predicted. The high level of consumer debt and the continued slump in real estate will both exert deflationary pressure. Normally, after a recession, consumer spending growth reaches the 4.5% mark, but this year spending growth is expected to hover around the 2% to 2.5% level. The economy is also facing the impact of the Federal Reserve’s plan to end its $1.25 trillion mortgage-backed-securities purchasing program at the end of the first quarter, which is expected to cause mortgage rates to rise.

Despite the challenges, Prudential’s panel of experts expressed cautious optimism about prospects for growth this year. John Praveen, managing director and chief investment strategist for Prudential International Investments Advisers sees solid sustained gross domestic product (GDP) growth driven by the substantial fiscal stimulus, low interest rates, inventory rebuilding and a modest housing recovery. In fact, Praveen says that the U.S. GDP will head up at approximately 3.3%. He also expects further stock market gains, owing in part to strong earnings recovery with GDP growth, widening profit margins and improved pricing power.

Praveen expects stocks to remain attractively priced relative to bonds, while Tipp believes this will be a good year for fixed income. “There is an inclination to buy bonds because people have been burned in the stock market,” Tipp says.

Quincy Krosby, chief market strategist for Prudential Annuities, believes there will continue to be a “tug of war” between the more pragmatic bears and bulls—this excludes the “perma-bears” and “perma-bulls.” Noting that bull markets are born on bad news and die on good news, Krosby said, “I hope there is enough bad news to keep this cyclical market going.”

Ed Keon, managing director and portfolio manager for Quantitative Management Associates, a subsidiary of Prudential Investment Management, is calling the new decade the “turbulent teens,” filled with both opportunities and potential pitfalls. In fact, Keon believes that slow growth combined with large debts from the current crisis could set the stage for another crisis by the middle of the decade. As a result, he believes that management of risks will become a bigger concern for investors than management of returns. This means products offering ways to protect against the downside while also offering the potential for returns on the upside will gain favor.

Despite his concerns, though, Keon remains fairly optimistic about growth prospects in the coming years. Right now it may be difficult to see consumer demand driving economic growth, but a couple of good employment reports could dramatically change the outlook.

“We tend to underestimate the power of cycles,” he said. “At the beginning of 2008 who would have guessed it was going to be as bad as it got?”