As I have said many times before we are not even close to a depression and this article is even more proof.
The paradoxical thing about today's economy is its strength. No kidding. Consider all the hand grenades lobbed at it. Higher oil prices. The housing implosion. Large layoffs in affected industries: autos, airlines, construction, mortgage banking. The "credit squeeze" triggered by losses on "subprime" mortgages. Despite all that, the economy hasn't collapsed. It's merely weakened. Output in the first quarter of 2008 was actually 2.5 percent higher than a year earlier.
I would be willing to bet you that even if things get really bad in Obama 1st Term we will get all sorts of rosy predicitions of a recovery "just around the corner." I would be shocked if we even see one mention of a recession or depression in the next 4 years.
We may even get some op-eds about how Americans upon facing tough times and perserverering. I bet the media will make it seem fashionable to save money and start living within their means. There might even be a backlash against conspicuous consumption. Which are all great ideas.
I keep thinking how an Obama America would play out and there are some positives. If he improves the national mood and makes Americans proud of themselves again I think it might just outweigh the negatives. That is as long as I am either all in cash and heavily short the market.
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