The nation is expected to lose 2 million jobs in 2009 and undergo economic contraction through the first half of the year, according to a report by UCLA’s Anderson School of Management.

The quarterly forecast was peppered with words like “ugly,” “nasty” and “abnormalities,” CNNMoney.com reported.

In the report, senior economist David Shulman said the recession will include four quarters of declining real gross domestic product, and unemployment will rise to 8.5 percent by late 2009 from the 6.7 percent reported last month.

The report began with a blunt statement from Shulman: “The news from the economy is bad. The recession that we had previously hoped to avoid is now with us in full gale force.”

The nation’s GDP will decline at a 4.1 percent annual rate in the current quarter, and it will continue to sink in 2009 by a rate of 3.4 percent in the first quarter and 0.8 percent in the second, the report forecast. The GDP declined at a 0.5 percent rate in the third quarter of this year.

Shulman predicted “tepid” post-recession growth at about a 3 percent rate, saying “the global economy is in its first synchronized recession since the 1990s.”

The report also predicted that the U.S. deficit will exceed $1 trillion in fiscal 2009, and it noted massive abnormalities in data from the past few months that make it difficult to forecast.

Shulman pointed to the housing market collapse as a trigger for increased defaulted mortgages, which threatened the liquidity and solvency of an economy that had become “dependent upon the easy flow of mortgage credit.”

The domino effect led to the culprit of the downturn: severe asset price deflation, which first reared its head as a liquidity crisis in the short-term money market in August 2007, causing a financial panic.

The report said stock prices are on track to either their biggest decline in history or their worst performance since either 1931 or 1937. Real stock prices never fully recovered from the bull market of the late 1990s, Shulman said, resulting in the “carnage” in the stock market today.