"Sitting on the Sidelines": the in thing during this Recession

Last week, Ben "the Great Timing" Bernanke, said we are out of recession. This is the same guy, when all this started, kept raising interest rates. Ouch! Although Bernanke has many more years in academia and age on me, come on. I call this recession the "Sitting on the Sidelines" Recession, or "SOS" Recession, simply because everyone has been and still is Sitting on the Sidelines.

Remember last year during the holiday season, when everyone was SOS to do their holiday shopping? We had horrible retail sales numbers until the final week before Christmas because everyone was SOS, kind of like the opposite of ebay, waiting for the price to come down as the auction gets closer to ending. Ouch, since we are a consumer driven economy. This is also apparent in the Real Estate market. Remember during the interest rate decreases? Everyone was SOS for their refinance for their 2 year ARM, 3 year ARM or interest only loans. Ouch! again, since Real Estate has helped us get out of all our previous recessions. Now, everyone(well, except in Texas) in the United States is waiting for Real Estate prices to hit bottom before they start jumping back in for their new home, SOS. Furthermore, possible employers are SOS awaiting better sales and top line growth numbers to start a massive re-hiring process and thaw out their hiring freezes. And again, Ouch!, since obviously people can't do any of the above without jobs.

Interesting enough, with all those ouches above, we cannot be out of recession yet. As a matter of fact, we still have much further on the downside to go. Funny, all this talk about a V-shaped economic recovery. More like this, VVVVVV. At this rate some of those V's will be lower than the others. Yes, I am saying it, the stock market has created another mini-bubble. We are headed lower, the DOW will probably hit 9000 to 8800 again and if it breaks 8800 we will revisit near 8500 again. We are bouncing on the ceiling as I type, right at 9900. Why? First of all, we are all SOS! Second, we have a new wave of foreclosures coming because of that cycle above or the lack thereof. There are a lot of people without jobs or scared that they will lose their jobs, without jobs and those confidence levels, they cannot or will not buy homes and consumer goods setting up for some dismal consumer confidence numbers going into the holiday season which is a lot of that topline growth that companies are looking for.