Originally published at Notes from the bunker…. You can comment here or there.

Fascinating article Uncomfortable Answers To Questions On The Economy. A very nicely laid out article explaining, as best I can tell, the current economic situation and generally saying that, as if we hadnt figured this out, its gonna get worse before it gets better. Some highlights:

Something has clearly gone wrong with the economy. But how bad are things, really? And how bad might they get before better days return? Even to many economists who recently thought the gloom was overblown, the situation looks grim. The economy is in the midst of a very rough patch. The worst is probably still ahead.

Job losses will probably accelerate through this year and into 2009, and the job market will probably stay weak even longer. Home prices will probably keep falling, shrinking household wealth and eroding spending power.

…..

The fate of the economy now rests on the shoulders of the American consumer, whose spending amounts to 70 percent of all economic activity.

When people go to the mall and buy televisions and eat out, their money circulates through the economy. When they tighten their belts, austerity ripples out and chokes growth.

If the economy is counting on my spending to help it out of the current situation, I think theyre in for a disappointment. My goal right now is to spend as little as possible, convert it into inflation-proof goods, and play it very, very close to the vest. And I know Im not alone in that plan. I don’t think theres anyone in this country who isn’t of the mind to check their purchasing. Let-the-good-times-roll spending is what created this situation and now we’re told spending will get us out of it?

Anyway, its an excellent article, two pages so its a short read, but I think its very informative and I recommend you take a look at it.