How to spot a recession without being an economist

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There is a current debate on TV whether we are in a recession or a slowdown. Well, here is my top eight list of how to spot a recession without being an economist or an analyst:

1) When you go to a restaurant and return a week later and there’s a “for lease” sign in the window…we’re in a recession

2) When you see “home for sale” signs on every intersection for extended periods, foreclosure rates climbing, mortgage companies going belly up because customers can’t make their minimum monthly payment…. We’re in a recession

3) When you decide to hold back on some purchases and convince yourself you don’t really need it….we’re in a recession

4) When commodities like Oil and Gold Make new highs and the stock market can’t find a bottom…we’re in an infla/cession (new term… maybe Bernanke will borrow this one)

5) When the banks start to hold back on new loans (the lifeblood of their business)….we’re in recession.

6) When the unemployment rate grows each time the Bureau of Labor Statistics releases its figures…we’re in recession

7) When the US Dollar gets the nickname of US Peso, we’re in a recession

If you’re feeling uneasy right now….we’re in recession

Is there a true and complete disconnect between the government’s definition and what the average consumer defines as a recession? YES.

Bernanke is waiting for an official definition of a recession: well here it is Mr. Bernanke: a slowdown in the growth of the GDP for a period of 2 consecutive quarters.

When he was asked last year whether we are heading towards a recession, his reply was: “Our forecast is for moderate, but positive, growth going forward….. “Economists are extremely bad at predicting turning points, and we don’t pretend to be any better” “We have not calculated the probability of recession, and I wouldn’t want to offer that today.”

So all the foreclosures, rising consumer debt, the rising cost of energy and food…under which economic definition does that belong? If the definition is different for economists and consumers, how do you fight one? I KNOW…you give back $1200 in tax credits for the year…that should really solve everything….

Oh well….Maybe I should ask the same guy that says global warming is just a phase…it will correct by itself.

Ok seriously…I know it must be hard to be the head of the FED, and there has to be guidelines. But I truly believe, that by the time they figure it all out….this cycle will almost be over. It’s the nature of things. By the end of the 3^rd Q of 2008, the cycle could start turning around for many consumers and home owners.

No worries, I am not looking to become Barnanke’s assistant…being a commodity broker is enough for me.

Sincerely,

Matt Zimberg

President

Optimus Trading Group