Recession is here. Tighten those belts and bookmark WalletPop

Put three economists into a room and you'll get five different opinions. For the past six months, the talking heads of finance have been arguing about whether a recession is coming, and whether we can do anything, anything at all, to prevent it.

In the last six months, the headlines have become more and more hysterical. Recession Coming! Recession Coming! OMG What can we do to prevent Recession?! Here's a favorite from today: Three out of five indicators suggest we might already be in recession.

Recession is a normal part of the business cycle. But to hear the bleating of today's headlines, you'd think they were talking about the Black Death.

News from the rats on the ground guys: The big bad recession is here.

In this I respectfully disagree with my colleague Tracy Coenen, who writes in a post this morning that the situation isn't as dire as all that, and that if we listen to the growing recession hype of the media, then we will indeed create for ourselves a recession. She's not alone in her thinking, as this piece in the NY Times attests.

I tend to think that it's not the media screaming about recession that causes a recession. It's the ugly, ugly numbers that are coming in from all the economic indicators. And on a smaller scale, it's in our wallets. Or rather, what's not in our wallets anymore.

Economists swear inflation is in check. But ask any working family if the cost of living has gone up. Groceries? Gasoline? Heating fuel? Insurance premiums? It's all gone up and gone up dramatically. The only thing going down (in a death spiral) is housing, which, obviously, is also hurting families where they live (pun intended).

When two-thirds of your economy is based on the consumer, it's just not a good sign when folks aren't spending like they used to because they can't afford to anymore.

The housing market is at a standstill. The banks are bleeding billions. Credit is very hard to come by, no matter who you are. (WSJ subscription required) The fed rate cut is a bandage for a correction that needs to happen, and will, sooner or later.

How can this not lead to economic downturn? I'm no economist. I ain't got no PhD in finance. But sometimes you just smell a rat. All the more reason to bookmark, for tips on how to save in the coming months. Stay tuned.
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