Let me be the first to tell you that, starting in September, we are going to see a huge surge of news articles about how the recession is over. The slowing will slow to a trickle, it may even start showing improvement!
Hallelujah! Glory be!
Sunshine and greenshoots!
Buy a house before it's too late!
Baloney.
Let me remind you, warn you if you will, that last September was when the economy went into the tank.
What the media and 'experts' will be doing is switching from the month to month vagaries -- trumpeting every upturn, downplaying every downturn -- to the year to year statistics, which up until this next quarter were so dire they needed to be hidden.
If I may use a boxing analogy.
The economy is like a boxer who got a huge blow to the head in Sept. of 2007, and was staggering around the ring trying to avoid his fearsome opponent, but he gets caught in Sept. 08 with a knockout blow.
What we've been seeing for the last year is that boxer falling to the mat, lying there dead for a few minutes while they inject needles of adrenaline directly into his heart. He's alive but barely, but the trainers keep throwing buckets of water on his head.
Starting next month, the fighter might be getting up on one knee. He's still woozy, he still sees little birdies and stars going around and around, but at least he's conscious.
But his fearsome opponent is out there circling, just waiting for him to try to get up on his feet.
Mark my words. We'll get nothing but good news in the fourth quarter. Things will look SO much better. But look a little deeper, and realize it's just coming up off the mat after a near death experience.
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The Fed is saying the recession is over (front page NYT today). Technically it may be, since a recession is a period of negative GNP growth and the GNP is finally growing again. But it looks like we're in for another jobless recovery, similar to what we had after the bursting of the dot-com bubble.
We've become a bubble economy, with no solid foundation in the form of stable, decent-paying jobs for the middle class. As long as some bubble is inflating (tech, real estate) we can float on it and maintain an illusion of prosperity, but then the bubble pops and we again start to look like what we really are -- a Third World country.
debt, debt and more debt.
We'll buy our way out of this...
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