If one looks at other indicators apart from those described here (e.g, commercial real estate, bank lending rates/LIBOR, Eastern Europe’s debt crisis…), there’s plenty to be concerned about and absolutely no reason to think that we are anywhere near bottom. For starters, this isn’t just another recession, where the government can hose crazy amounts of cash into the economy in the hopes to create new bubbles that will lift us our of our current predicament. Rather, we’re in a deflationary period where we’re crippled by too much debt.
Consider, the total US debt is 3.5 times our GDP!! We just reached a new national debt level of $11 trillion. Until this debt is reduced, there is NO recovery in site. And currently the government is doing anything BUT reducing debt. Add to that, all this new debt our government is creating is backed by US TAXPAYERS. The more the government does to “fix” this financial problem, the worse they are making things. As our economy gets worse, it’s going to come down squarely and exclusively on We the Taxpaying Americans, and we can thank our government for this.
