We’re not sure which numbers mainstream economists are using to make their projections, but they seem to have generally missed their forecasts for the last several years. One economist in particular, however, uses real numbers based on the facts, and he says There Is NO Economic Recovery Happening:

Look folks, this is really quite simple.

Economic Stability and Recovery = Credit Expansion.

We cannot recover until we purge the excess debt from the system, and the longer we take to do that, the longer the pain will last and the worse it will be.

President Obama and Tim Geithner know this – that’s why they are constantly harping on banks to “lend more.”

Well, they may want banks to lend more but the people are fed up with being debt slaves and are borrowing less.

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These rates of decline are unprecedented and they are not slowing down.

The drop in credit card debt outstanding is on the largest on record since The Fed started keeping those records in 1943!

Consumer recovery?

There is none!

How often have you heard the line the President and his minions say that the banks need to free up lending for consumers and small businesses? I’d say it is a regular part of Mr. Obama’s speeches when he discusses the economy. It’s been nothing more than lip service. Banks are NOT lending more and consumers and businesses are NOT borrowing more, even after trillions of dollars in bail-outs and stimulus. In an economic system based on credit, this is not a good thing. The economy continues to contract.

This is has been a 20 month (at least) ‘recession.’ But normal recessions last about 11 months.

According to our elected officials and appointees, this one was just a bit more severe than past recessions and all is well now.

We would call Mr. Denninger’s charts and research factual evidence of the current state of the economy.

However, you can believe what you choose to believe.  Subscribe to the theory that the economy is recovering. Call us doom and gloomers. Feel free to call this opinion.

But before you do, we’ll point out another recent post from Mr. Denninger, Here It Comes (You Were Just Warned Folks):

Don’t worry folks, it can’t happen again.  Remember, The Fed has our back, just as they did in 2006 when they told us there was nothing to worry about in the summer when we got the swoon (remember that?  I do – and bought into it!)

The picture now is actually worse than it was in early 2007.  In early 2007 we had solid employment, we still had a reasonable housing market although it had slowed some, GDP was positive and we had just come off a GREAT Christmas season with extraordinary profits and sales.  In addition we were running ~350 billion in deficits, not $1.6 trillion (estimated for FY10) nor did we have to roll and issue over $2 trillion of treasury debt (to someone!) in the next 12 months.

Now we have the regulators issuing formal warnings about bank liquidity and interest rate risk (no really, you think that might be an issue with that sort of issue behavior?) while at the same time formal liquidity support in the form of monetization along with stimulus spending is slipping away – the source of the liquidity that fueled the rally from March.

Ignore all this if you’re brave – or stupid.

The hammer’s going to come down on us, sooner rather than later. Don’t be surprised when it does.