It looks like you weren't crazy after all. This Depression really is as bad as it seems.
(Bloomberg) -- The first 12 months of the U.S. recession saw the economy shrink more than twice as much as previously estimated, reflecting even bigger declines in consumer spending and housing, revised figures showed.
The Commerce Department’s Bureau of Economic Analysis actually went back and revised their economic figures all the way to 1929, although most of the revisions are since 1997. So as not to bore you with too many details, I'll keep this short and sweet and only touch on the highlights.
February 14th, 2008 – Paulson: (the economy) "is fundamentally strong, diverse and resilient."
February 29th, 2008 – Bernanke: "I expect there will be some failures. I don't anticipate any serious problems of that sort among the large internationally active banks that make up a very substantial part of our banking system."
Over the most recent period, the third quarter of 2008 underwent one of the biggest changes, going from a 0.5 percent decrease in gross domestic product to a 2.7 percent drop. The new reading better illustrates the effect the September collapse of Lehman Brothers Holdings Inc. had on the economy and credit markets.
Also, the first quarter of 2008, which was originally reported to have a positive GDP of 0.9%, was revised to negative 0.7%. The first quarter of 2009 was revised lower to the worse showing in post-WWII history.
May 7, 2008 – Paulson: 'The worst is likely to be behind us,”
June 9th, 2008 – Bernanke: Despite a recent spike in the nation's unemployment rate, the danger that the economy has fallen into a "substantial downturn" appears to have waned,
You will probably hear the Green Shooters focusing on reports of the economy shrinking at a slower rate. It's almost as if they are suggesting that digging a hole at a slower rate will get you closer to the surface.
What they won't tell you is what is actually in the report. For example:
Real personal consumption expenditures decreased 1.2 percent in the second quarter, in contrast to an increase of 0.6 percent in the first. Durable goods decreased 7.1 percent, in contrast to an increase of 3.9 percent. Nondurable goods decreased 2.5 percent, in contrast to an increase of 1.9 percent.
Pretty much the only numbers that are going up are government expenditures - not something a healthy economy can build upon.
Real federal government consumption expenditures and gross investment increased 10.9 percent in the second quarter, in contrast to a decrease of 4.3 percent in the first. National defense increased 13.3 percent, in contrast to a decrease of 5.1 percent. Nondefense increased 6.0 percent, in contrast to a decrease of 2.5 percent. Real state and local government consumption expenditures and gross investment increased 2.4 percent, in contrast to a decrease of 1.5 percent.
July 20th, 2008 – Paulson: "it's a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation."
July 16th, 2008 – Bernanke: (Freddie and Fannie) “...will make it through the storm”, "... in no danger of failing.","...adequately capitalized"