Take a look at this chart!

Isn't it great to see such competence in action -- just when we needed it most.

Here in the Washington Post is a good rundown (the apt term) for all the signals pointing ‘down, faster’.

interesting IMF forecast

This is an interesting table, published in “Dawn“, Pakistan’s leading English-language paper.

Note the world-wide negative growth forecast for this year.  But note, too: the IMF forecasters are looking to growth to resume in 2010 — albeit very anemically in Europe. We’ll be blessed if we get the 3% they are suggesting may be ahead for us in the US.   This may be the natural up-tick that seems to emerge from forecasts methodologies.

Here is the whole article, which is likely being read all around the world right now.

(It is worth reading Dawn. This is a major window into the heart of the South Asian instability — Afghanistan & Pakistan — that is going to absorb hundreds of billions more of your and my money.)

Jumping to London. Here in The Independent is one observer’s immediate reaction to the IMF forecast in the chart above: “We’ll get poorer faster [than at any time since the war].”

Downturn Accelerates As It Circles The Globe Economies Worse Off Than Predicted Just Weeks Ago

The world economy is deteriorating more quickly than leading economists predicted only weeks ago, with Britain yesterday becoming the latest nation to surprise analysts with the depth of its economic pain.

That is the front page headline on this morning’s Washington Post. We may still be headed for a second great depression — make that Great Depression.

Coming to our neighborhood?

The whole point of the stimulus spending is to prevent this recession from deepening into a world wide depression.  So far, the stimulus is not working — indeed, the pace of collapse is accelerating.

Here is a very interesting comparison by Paul Krugman of 2 ways to think about our recession crisis.

Keynes

Krugman

Your view?

Krugman: “Many people have noticed that Obama’s address seemed to include a shout-out to John Maynard Keynes. But I think there’s a revealing difference.

Here’s Keynes:

This is a nightmare, which will pass away with the morning. For the resources of nature and men’s devices are just as fertile and productive as they were. The rate of our progress towards solving the material problems of life is not less rapid. We are as capable as before of affording for everyone a high standard of life-high, I mean, compared with, say, twenty years ago-and will soon learn to afford a standard higher still. We were not previously deceived. But to-day we have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand.

Here’s Obama:

We remain the most prosperous, powerful nation on Earth. Our workers are no less productive than when this crisis began. Our minds are no less inventive, our goods and services no less needed than they were last week or last month or last year. Our capacity remains undiminished. But our time of standing pat, of protecting narrow interests and putting off unpleasant decisions - that time has surely passed.

Keynes, in effect, declared the crisis a failure of ideas; Obama makes it a failure of will.”

We tend to use the stock market as a kind of national thermometer: down bad, up good. Yesterday, Obama inauguration day, the big dive on the big board may have been a good sign–that Wall Street is sobering up.  Here’s the WashPost’s analysis:

Disillusioned investors fled financial companies as fresh evidence mounted that the industry’s problems are larger than previously understood, larger than the response so far mustered by the government and perhaps larger than the resources remaining in its rescue program.

That’s a pretty sobering analysis for us, too: our financial system is still in a pickle despite $trillions in ‘fixes.’

Here’s an example of the banking-and-building problem:  Good builder, business sound, bank shuts him down anyway.  Yet overall only 15% of homebuilding projects are in trouble — showing that banks aren’t making very good decisions.

I asked a group of high school students visiting the legislature yesterday if they could see the recession.  Instant answer: Yes! They see businesses going down all around them.

Like an avalanche crashing downhill, job cuts multiply.  One cut leads to another as outlined here in today’s Tacoma News Tribune.

In my view, the first and main job of the legislature is to do everything we can to slow down and then reverse these job cuts.  We can’t just stand on the side of the hill and watch the job losses roll through the whole economy.

10 year unemployment trends in WA

Here is that unemployment graph for Washington:  You can see that we need to generate about 75,000 jobs to get back to where we were last July.  I think we should use this chart as one of our main indicators of how our stimulus package is doing.

What do you do if a giant sinkhole opens up in your neighbor’s yard?  Do you throw dirt from your yard into the hole, hoping to stop the hole so it will eventually refill itself?  Or do you buy that portion of your neighbor’s property so that he can take these ‘toxic assets’ off his books and get on with his life while we figure out what to do?

and it's getting bigger by the day...

Isn’t that the choice we are being offered?

Here is the wise New York Times financial columnist Joe Nocera with his views.  This is the first thing I’ve seen in print where someone is trying to think ahead … in a word, to be forehanded (about what the bankers should have been forehanded starting years ago).