You Say Recession, I Say Depression - Let's Call the Whole Thing Off

There does seem to be such disagreement on the matter, doesn't there? I was walking in Greenwich Village this afternoon and I heard a father attempt to explain this situation to his daughter, and he said, "No sweetheart, we aren't in a depression yet. We're in the recession stage".

I thought to myself, "Wow, even though there was a recession (1992) when I was just as young as this girl, I can't remember either my father talking to me about it or any discussion of a depression". Surely, if fathers in New York City are preparing little children for the upcoming Depression, any minimizing of the current situation as a passing recession seems shortsighted.

According to historian John Paul Rossi at the History News Network, the current downward spiral bears many similarities to the 1929 scenario. In his piece, he concludes with a dire prognostication.

The American economy in 2008 is following the same path it took in 1929. The collapse of a speculatory bubble has merged with problems of the distribution of wealth, working American incomes, and consumption. The consequence is that the economy is rapidly spiraling downward into the next great depression.

Indeed, perhaps even more ominous is a recent post at PoliticalWire indicating that President-elect Obama's advisers seem to share the same view.

Add to that the increasingly precarious state of the US auto industry, and I am starting to wish my father would console me too!