Bad News, Bears

That grim economic data I mentioned down below starts off with Citigroup's expected move to lay off anywhere from 35,000 to 50,000 employees.

Citigroup Inc plans to shed about 10 percent of its global workforce, a person familiar with the matter said Friday, as the bank tries to return to profitability and faces mounting criticism of Chief Executive Vikram Pandit.

The cuts could result in a loss of roughly 35,000 jobs, based on the bank's reported 352,000-person workforce as of Sept 30. The cuts will be on top of the 23,000 jobs Citigroup has already slashed this year.

Additional reductions would come from layoffs, the sale of units and attrition, said the person.

The financial sector is getting gutted. It won't be the only sector of the economy that takes massive job loss numbers either. The stubborn belief this will be a short recession, with predictions of an unemployment rate peak of 7.5% and a recovering economy in summer 2009 are downright silly.

This is a consumer-driven recession. It will be long and painful because the US consumer drives not only the US economy but increasingly the global economy as well. If the US consumer isn't consuming stuff...who will? We don't have the money for stuff, we're tapped out, credit is drying up and we have no more money to spend.

And as US consumers save money and spend less, the recession will get worse and worse as more businesses that depend on consumption go under, taking more money out of the economy. There's no real hope for any serious recovery until the housing depression ends. That may not happen until 2010.

And by then it may very well be too late. But all that is Obama's problem now. If he's still listening to the same economists that got us into this, we're doomed.

Even so, there's little Obama will be able to do other than turn on the inflationary printing presses. When that happens, all bets are off. Bush has done too much damage to the economy. In reality the damage to our economy started with Reagan, but some say even earlier when we went off the gold standard with Nixon, and some say even earlier then that with FDR and the New Deal.

The specter of global depression is becoming increasingly likely with each week that passes.