Be careful....I'm betting that the worst is yet to come.

Global markets have taken a hit along with the US markets but they are providing us a safety net and will help us recover.

My bet is that come fall, it will become entirely apparent that we entered a recession sometime in the spring of 2007.

One can dissect Money Supply, Consumer Spending, Yield Curves, Foreign Markets and Economies, numerous other Federal Government Indicators and unknown other indicators, take your pick. My comment is they just leave you confused.

Once you have exhausted those numerous and rarely reliable indicators, then take a look at the general picture.

For the most part, and from what I can see, business is down, and the number I keep hearing is 20% or more. And it would be safe to say that things have not even hit the preverbal fan yet.

Don’t agree? Many wouldn’t, but look at the reality.

Housing sales were already down, and the hit against the mortgage markets over the last two weeks will only start to be felt in the coming weeks, perhaps months, and that does not include further credit market failures, be that what they may be. There is no question that it will be very much a buyers market; however indications are that it will be exceedingly difficult to obtain mortgages, leaving a huge amount of unsold houses on the market. Given the difficulty in renewing maturing mortgages, it is likely to accelerate the issue further. I suspect this will become a very ugly part of the economic environment over the next year or more.

Car sales, the die hard economic indicator are I gather from the dealers, horrible….enough said.

Contrary to what the government is telling us, fuel sales are off across the country. There appear to be areas that are not as affected as others, and the West coast is apparently still fairly strong, but in the Southeast, with a large concentration of the populous, and of the accompanying leverage/debt, fuel sales are off a solid 20% across the board, with the accompanying trucking. Traffic is lighter, period.

The trucking numbers are down, right across the board. Freight has slowed up, which will domino right into the rest of the economy.

All certain indicators, very similar to 1987 and 2001 that things may likely become rather brutal before it is all over.

The variables that I think will be fascinating will be the interest only 5 year mortgages that will start coming due in the next several months to a year. Will the lenders renew, or with the stricter requirements, will a number of houses be foreclosed on with current owners either unable to afford the payments or perhaps not able to obtain new financing, and furthermore not being able to sell the house with the aforementioned glut already overhanging the market.
And more intriguing will be how the Presidential election plays on the economic downturn. It is tough to have an election in a bad economy, so will the government try and inflate our way out of it, which may cause more harm than good.

It will be interesting to see.

perfect predictions, the credit crisis did cause chaos

So here we are in the worst recession since the Great Depression, and as much as I keep kicking myself that I am wrong, the more it appears that the Depression of the 30's may be a walk in the park compared to this one.

Regrettably, we have people, both incumbent and elect who have not a clue as to what is going on. And even less idea on how to solve it.

Lending money we do not have will only make it worse. Rescue the automakers and everyone else and we have dealt the coup d'grace. The TARP is out of control.

As horrible as it sounds, the only solution I see right now is a terrorist attack of huge proportions. That would stimulate the economy, much as 09/11 did.

We are at a point where we may need to revalue the dollar, or perhaps even replace the dollar with a new currency and different values, and National Bankruptcy is not out of the question.

There is a huge amount of currency outside the country, be that the former east block, drug cartels in South America and numerous other vaults and safe storage, be it inside the US or elsewhere.

Reissue the Fed Currency, and that money comes back into circulation. You can transfer for a pre-set time, and after that there is a tax, with full reporting for all.

If you have nothing to hide, you are in good shape. But if you are holding an undeclared and unaccountable sum outside normal channels, why are we replacing it. It strengthens the currency.

Not a lot of happy people, but we rescue our currency and bring in a huge amount of untold strength.