Wizened by decades of deindustrialization and a slow acclamation to a declining standard of living, the American economy is once again finding itself staggering into recession, one that is certain to aggravate a country that, on many levels, had not even recovered from its last recession in 2001.

The great myth of recession, though, is that it is temporary. So goes the maxim, once the economy is out of recession, job growth will bounce right back. One time, this may have been true. But a closer examination should reveal that, now, the layoff spells of the so-called "business cycle" (a common misnomer) do not act as "furloughs." Suddenly, the word "recession" has found new meaning: that many who lose their jobs are permanently displaced. It doesn't sound nearly as benign as "business cycle", and there is a reason: recessions aren't benign by any measure. This is hardly any "sky is falling" stuff. As each economic cycle has passed since around the post-World War II period, the proportion of unemployed who remain so for at least several months has risen so that, as one expansion is about to end, a greater proportion of the unemployed are displaced for the long term than in the economic peak.

The ever deteriorating real estate market is gradually, patiently weeding its way through the economy. In my judgment, the slowness is becoming a consequence of the attempts by the central banks and federal government to stave off the inevitable. As tautologic as it sounds, yet for whatever reason is constantly in need of recollection, the inevitable cannot be prevented. But the results could not not come soon enough. The rising foreclosure levels have undoubtedly reached epidemic levels. The number of REOs (that is, homes that have been repossessed by banks) has been skyrocketing since August.

On top of this, we see several sectors of employment growth breaking down. Fewer and fewer sectors are contributing to growth, and in a few words, this summarizes the anemic, but not yet negative, job growth we're seeing. Picture it like this: at ground level, the surface appears to be quivering, but is not eroding so much. We suspect some tensions taking place, but it seems benevolent. However, beneath this layer, the bottom is constantly eroding. The erosion is making its way to the top, and is poised to breach the surface.

You may want to set 15 minutes aside to read this whole thing through.

The course of the economy is mysterious, as evident in the contradictory reports that we see week after week. Take, for instance, the gross domestic product, the most superficial indicator of economic health. After growing at a torpid 0.6% annual rate from January to March, the GDP apparentely grew 4.9% between August and September. Yet, even as this acceleration was going on, employment growth has not only grown at a considerably slower pace, it now seems the growth that was reported has been overestimated. This went likewise for income growth. Before getting into this, we'll examine some of the recent economic reports, which suggest a very serious slowdown is taking place.

The Commerce Department gave the stock market a very tasty Halloween treat today while friendly neighbor Ben Bernanke offered more candy later in the day. Allegedly, the economy grew at a 3.9% rate from July to September. Eyebrows shot up. For one thing, this was an acceleration from the 2nd Quarter and the period it encompassed was rife with the prospect of the housing market being at its worst in American history and a nascent credit crunch that exposed more than just a few statistical noises in the balance sheets of major financial firms. Most interesting about the GDP report, perhaps, was that the GDP price deflator only grew at a 0.8% annual rate. This simply means the amount of inflation that impacts the GDP. Nominal GDP grew 4.7%, real GDP grew 3.9%, thus the 0.8% difference. In other words, this was the slowest pace since 1963! Does this make any sense whatsoever? Hop into the Bernanke Copter for a ride to the rest of this story.

If you haven't been trapped by the CNBC noise machine, you should be aware of the on-going credit crunch. After the Dow Jones Industrial originally peaked on July 19th, it began a steep descent that became horrendously dangerous within days. To put it in this perspective, by the third week of the crisis, the DJIA was at one point down for six days in a row. On the first day (August 9th), it had plunged 387 points. On the sixth day (August 16th), in hindsight the markets seemed determined to go for, at the least, a mini-crash. At one point that day, stocks were down about 400 points, only to close flat after the soothing words of Ben Bernanke could be heard on the other side of the wall, "I'm here for you." Since then, stocks were moving at a bubbling rate that has, until now, been consistent. After reaching a record high, it seems that this was more the result of overshooting on a euphoria that was simply unfounded. Welcome back to late July.

So the cliche goes, there is good news and there is bad news. I really can't give you much of a choice here, so I'm giving the good news first in order to explain the bad news. The number of jobs created for September was +110,000 and August's terrible -4,000 was swung violently to +89,000. That was the "good news", because it is not recessionary. But this is about as good as it gets. While the revisions are not so surprising (and revisions do seem to have an odd habit of making wild swings), the details that contributed to the revisions might be surprising.

Just as soon as I was sure the divergence of the stock markets and the economy had peaked, the DJIA pulls another fast one, smashing through record territory on Monday. Yet the data coming out show that the situation in the housing and credit markets continues to worsen. Guess what is driving this stock rally? Speculation! So if it's speculation, you should be cautious to observe that this may indicate a miniature stock bubble. The recent stock rally the past two weeks, for instance, was on BAD news, thus the Bernanke/Greenspan Fed (considering Greenspan has basically continued to play the role of Fed Chairman by strongly influencing Wall Street with his almighty words of wisdom.) But what happens when "good news" comes out that the credit crunch's worst may be over? Stock bust, because there would be no Fed rate cut? Nope! Pure bacchanalia! This was hardly surprising. I expected stocks to breach the record level either last week or this week. It met at mid-point, conveniently enough.

The news that have strung the days together this past week seem indicative of a housing recession that has deepened relentlessly. "Worse than expected" is a frequently written phrase these days, a reflection on the idea that the forecasters were too optimistic on their part. One of the other mysteries is the ascending stock market, which has acted as though nothing ever happened during the past two months. As it turns out, this appears to be a "recession rally", cheering any news that add fuel to Wall Street's hopes the Fed will again cut rates to keep the heroin flowing.

This diary is more disconnected than previous ones, less essay-like and more like a commentary that jumps around. Basically, it's just a potpourri of economic news and so forth. We'll see how it goes. Let's venture into this jungle and see what we find.

As if these times weren't already filled with enough white knuckle issues, from the cataclysmic Iraq to the flagging economy, the FBI tells us that violent crime continues to rise in the United States. Blood is trickling down the cracked sidewalks tucked between abandoned homes of our cities, those foundations of America. Noteworthy was the escalation in robbery, which exploded 7% in 2006, helped by a dramatic rise in street and bank robberies.

This will be pretty short, but Japan has announced that the economy there actually shrank in the second quarter. The Japanese government originally announced the economy grew. What's more is that this was twice as bad as the forecast was. This comes at a time when the U.S. economy is slowing down and produced only 120,000 jobs over the past three months (including a loss of 4,000 jobs in August.)

The first batch of recessionary data has been released. The housing bust was converted into a recession sometime in the 31 days of August that divide July and September.

A change of -4,000 jobs was reported for August, the first time since August 2003. That was severely worse than expected. The lowest forecast was a gain of 35,000. July was revised downward from 92,000 to just 68,000.

A preview of Friday's employment data for the United States economy shows job growth nearly flat for the months of July and August. ADP Employment Services suggested that only 38,000 jobs were created in August. This is pretty much in line with my own prediction a few days ago of only 20,000 new jobs. In other words, this is the slowest job growth has been since June 2003 when the country was still seeing job losses in that recession. As for July's data, this was revised down to 41,000 new jobs. That there have been two consecutive months of weak job growth offers more evidence that this is not an aberration, but that the credit crunch is having a deleterious effect on the economy.

This is going to be a fairly short diary, mostly just to explain that the most updated data on economic growth for the 2nd Quarter of 2007 should be taken with a grain of salt——a very large grain of salt. Thursday's data also show that jobless claims jumped to their highest levels since April and continues a 5-week ascent. These are two signs of the consequences of the mortgage crisis, one that has metastasized at a breakneck pace over the past few weeks. More on this on the next page...

With little fanfare and little exuberance during its reign, save its staunchest supporters who nevertheless dared not delve too deep into the less-than-stellar details, this period of economic growth still archaically called "prosperity" is about to end (between now and November.) There is no clear cut equation saying it will happen for certain (and hopefully I am wrong), but I'll play the contrarian here, because I do know, for one thing, that complacency (when many are in an optimistc lull) is a sure sign something is still amiss. But this here is just evidence to make a case for recession. For the sake of argument, I am using future sense (which assumes a recession will happen.) I believe we have hit a crucial inflection point in the summer months of July and August. The implications for this are many. Think this is just more alarmist banter? Some prominent voices seem to agree the boom will likely bust the economy (or already has.) Read on. Here now is an analysis of the so-called "Bush Boom", where I will also elaborate on some of the implications of its closure.

The price for regular, unleaded gasoline at a station near you is, more likely than not, above $3.00 a gallon, the highest in 26 years (when adjusted for inflation.) As a raw number, $3.07 a gallon is the highest EVER.

April added 88,000 jobs last month, but where were most of the jobs created? More over, where are the jobs being lost that are dampening this already anemic economy? Is the housing recession that was thought to be totally separated from the 70% of the economy harmless?

Recent news on the economy suggests the White House's wet dream of making every American the owner of a house they can't afford is faltering ever more. Housing sales continue their precipitous collapse and consumers are, once again, feeling the pinch of stubborn inflation and sharply rising gas prices.

These are the stories and the sad details of an escalating crisis of gun violence in the United Staes.