The Fed confirmed the contraction in the U.S. economy yesterday when it released the preliminary GDP results for Q3. Coupled with the most significant drop in consumer spending since 1980, the troubling signs in everyone’s gut have finally reached the statisticians.
I continue to believe that we’re spinning through  a self-fulfilling prophecy, filling our minds with paper tiger headlines that lead to retrenchment. [Geoff Colvin, a Fortune columnist expands on this concept and includes other “vicious cycles” we need to watch.] We believe we’re acting prudently in the face of that information but the net result is reduced consumption which drives 70% of our economy. The very jobs we fear losing are at greater risk because the demand that supports our jobs is diminished. It’s a vicious cycle that is only broken when there is a resurgence of confidence that the sky is not falling, tomorrow is a new day and with renewed vigor and focus, things will improve.
Let’s hope that’s the primary result of the Presidential election on Tuesday.