When Brooklyn Democrat Charles E. Schumer questioned Federal Reserve Chairman Alan Greenspan at a House Banking Committee hearing last week, the New York congressman began by describing recent conversations with people who believe the nation is headed for a recession that, as the old saying goes, would curl your hair.

The cautious Fed chairman agreed that many Americans believe that is the case and said those feelings are "quite relevant" to the economic outlook. He said, however, people have been wrong in the past. Another member of the committee, Rep. Jim Leach (R-Iowa), whose district includes an industrial area along the Mississippi River and wide swaths of farmland, reported that many people in his state say the economy couldn't be better. Conflicting notions about the condition of the U.S. economy will probably endure for a while. An array of reports last week ranging from personal income and consumer spending to new orders for manufactured goods and car production cutbacks did little to clarify the situation.

No longer are there any arguments that the economy is retrenching. The issue now is how far the process will go. Will it be a mild downturn, a brief recession or a deep, long-lasting recession?

Before the exchange with Schumer, Greenspan told the House Banking Committee that the numbers tracing economic performance pouring into the central bank showed a downturn in October. Weekly figures since then have indicated the slump continued in November, he said.

"Although economic activity seems to have been better maintained than many forecasters had expected, all indications are that a meaningful downturn in aggregate output occurred as we moved through October and into November," Greenspan said.

The Fed chairman carefully avoided making any forecast other than to say the downturn so far makes it likely that the gross national product, adjusted for inflation, will be down this quarter. The GNP is a measure of the nation's total production of goods and services,

At the moment, answers about the economy's future involve judgment calls, as they usually do when the economy may be changing course.

A substantial majority of economists believe the United States last month entered its eighth recessionsince World War II and that it will be the middle of next year, at the earliest, before the economy stops losing ground and begins to grow again.

October and November were poor months, with production falling, layoffs mounting and personal incomes and consumer spending not keeping pace with inflation. Furthermore, real estate market conditions ranged from flat to disastrous in many areas, a reality fully reflected in the construction industry.

Some more cautious economists, however, are less sure of what lies ahead. While a recession may look like an odds on bet, there is something about some of the recent economic statistics that simply does not feel right to these economists. Greenspan touched on that point in his exchange with Schumer.

"Everyone I talk to, not just in New York but colleagues around the country, with occasional exceptions, seem to feel the economy's in much worse shape than the data shows," Schumer told Greenspan. "These are heads of companies and heads of unions and economic leaders and forecasters. People on the front lines seem to think things are quite bad.

"How can we explain the disparity in the data you get and all of these impressionistic views?" Schumer said.

Greenspan said: "The world out there, when you look at the hard data, is not in as bad shape as it feels. This is not an unusual phenomenon; I mean it happens quite often, but it is a fact ...

"In other words, we do have lots of evidence which suggests that when you survey people they say, 'Well, my business is doing fine, but everyone else's is awful and getting worse.' We've seen that before.

"If the economy were as bad at this point, or was just about to get as bad as a number of my friends and your friends keep telling us, we should see weaker numbers in ... key areas," Greenspan said. "You should not have the level of passenger car sales and light truck sales that we currently have. There's got to be a mistake in those durable goods order figures that came out {last week} ... and a number of other items which don't square with this rhetoric."

Greenspan's point was not that consumers are snapping up new cars at a great rate or that the books of manufacturers are bulging with new orders. Production cutbacks announced last week by General Motors Corp. and Ford Motor Co. demonstrate that orders are weak.

But the latest figures -- new orders for October and car sales through the first 20 days of November -- were not nearly as weak as they normally would have been if the economy was on a fast downhill slide or if consumers had cut back their purchases in line with the enormous drop in confidence shown in national surveys since Iraq invaded Kuwait in August.

The order figures, which showed an increase of 3.6 percent from September to October, were particularly noteworthy because they are usually a solid indicator of future production levels. The levels have shown little growth since early this year, but have not declined.

Furthermore, the unexpected strength of the order figures is a signal that businesses do not have large amounts of unsold goods on their shelves and at their plants. In past recessions a need to unload unwanted inventories has caused a sharp drop in new orders for goods and then a large decline in production that sent layoffs and the unemployment rate soaring.

Orders can be canceled, of course, and car sales could fall dramatically at any time. But so far neither has happened and the economic outlook continues to be murky.

Whether more prosperous areas of the nation, such as Leach's district in Iowa, can continue to flourish may depends on the course of events in the Persian Gulf.

Large increases in crude oil prices clearly were responsible for the recent collapse of consumer confidence and a significant loss of real income. The rise in oil prices will make a further hit on purchasing power in the wake of last week's increase of 5.1 cents a gallon in federal gasoline taxes.

If consumers continue to reduce their purchases of cars, gasoline and other items, as had occurred in October, retailers will order fewer goods, manufacturers will produce less, employees will join the ranks of the unemployed and real income will fall further.

So far, the U.S. economy has not been fully caught in the grip of that process. If it does happen, there no longer will be any doubt about the outlook.