the closet economist comes out (in a second-hand evening gown)

OK, its been a while since I blogged about financial matters, but I am increasingly convinced that things are going to get worse before they get better. I'm talking about the Dreaded Double Dip recession. Here's why:
*Major worldwide unrest and financial uncertainty is causing spenders to become savers and lock up their liquid assets. This is especially true for the top earners, because they have more of a choice to spend now or not. If you're looking for the ultra-financially-conservative to break us out of this frozen economic state, its not going to happen. The only way to get these tightwads to part with their hard-returned income is to tax it (sorry rich guys)!
*Political bickering is impeding the process of getting things done. We have the political equivalent of an old married couple with opposing financial views. while they fight about whether to spend their money on wars or social security they're getting deeper and deeper into debt that will be impossible to pay off.
*Pretending there is not a problem does not make the problem go away. You keep telling yourselves for the past two years that things can only get "better" from here. well, have they? Average folks have had to tighten their belts and make due with salary cuts so why shouldn't you (government) make some sacrifices, too?
*None of the economists have a clue what's going on with the markets. Does this inspire confidence? Want to give them your hard-earned money to invest? Nope, me neither.
*The housing market still sucks. I mean this literally. We have such a disastrously huge inventory of homes that people can't afford (foreclosures, short sales, pre-foreclosures, people who want/need to refinance) that the housing market is not going to be normal for a long, long time. For those of you who can still afford your homes and taxes, expect your home's value to drop (if it hasn't already, consider yourself lucky. go play the lottery. now.) Rent it out, lease-option it, use it as a chicken coop but whatever you do, I strongly advise you against trying to sell now.
*I do not by any means want to be alarmist. On the contrary, if you own a home you can still afford and have any kind of job (or two) you'll be just fine. You probably won't be taking any exotic vacations this year (unless they're to third world countries, which are totally a blast by the way) but if you are lucky enough to have a dual-income household and can afford to live on just one of those incomes you'll be in great shape when this economy eventually starts shaping up. And if it doesn't, you'll have a great nest egg saved in order to dip Dodge and move to one of those awesome third world countries you've always dreamed about.