All Bad And Getting Worse

Now you know. The "recession" we're living through now is just the beginning. There is a double dip bummer coming, or as some of us maintain, the never ending anvil of awful news will simply continue, with the rich getting richer and everybody else scrambling to live through unemployment, floods, earthquakes, and fear of other impending catastrophes. Soon they will stop using the word "recession" and just say "permanent crap" to describe the economic realities everybody but economists have seen for the better part of a decade.

But now it seems that we really KNOW it's really bad and never ending, which is better than the horrible uncertainty of not knowing.

Weakness in leading economic indicators has become so pervasive the Economic Cycle Research Institute now predicts a new recession is unavoidable.

"The vicious cycle is starting where lower sales, lower production, lower employment and lower income [leads] back to lower sales," co-founder Lakshman Achuthan declares in the accompanying video.

Whereas Achuthan said the jury is still out in late August, the weakness in leading economic indicators — and ECRI uses a dozen for the U.S. alone, he notes — has become a "contagion" that is spreading like "wildfire."

Although the recovery has been "subpar" by nearly every measure, Achuthan refutes the idea the economy never got out of recession in the first place. "Just because it looks and feels a certain way doesn't mean it's a recession," he says. "You haven't seen anything yet. It's going to get a lot worse."

It's too soon to predict just how bad it's going to get, but he expects another spike in unemployment and further expansion of the federal government's $1 trillion deficit. This forecast has huge ramifications for the 2012 election and the already struggling U.S. consumer and Achuthan says a "mild" recession is the best-case scenario.

By now you may be wondering what separates ECRI's recession call from the myriad other recession calls out there. First, ECRI's primary raison d'etre is predicting recession and recovery calls. Second, and more importantly, The Economist reports ECRI has never issued a "false alarm" on a recession call, meaning many of the Chicken Littles currently declaring "the sky is falling" might actually be right this time around.

[yahoo! Daily Ticker]