The economy - looking at stuff "on the other hand"

Because Good Shepherd, Sioux Falls had some founding members of a local retirement community, the Rector (yours truly) gets to sit on an Endowment Board.

We get some great quarterly reports from some of Wells Fargo's capital management pros. Here's a bit of comparative economic perspective from Jim Paulsen, senior Economist with Wells Capital Management:

No doubt the economy has suffered a significant slowdown, but it is hardly (at least, yet) collapsing. What has collapsed? What is worse than the performance of the economy itself? Consumer confidence, investor sentiment and widespread generalized fear! The consumer confidence index recently declined to one of its lowest levels ever recorded. Currently, this index is about 10 percent “below” its worst reading during the entire 1982 recession—a recession widely recognized as the worst ever since the Great Depression! By comparison, in 1982, annual real GDP growth was -2.7 percent (today it is +2.5 percent); the unemployment rate peaked at about 11 percent (today it is 5.5 percent); job losses from the peak amounted to 2.8 million jobs, or 3.1 percent of the job base (compared to only about 0.4 million job losses, or about 0.32 percent of the job base today); the core rate of inflation was above 10 percent (today it is 2.3 percent); and the 10-year Treasury yield was above 14 percent (today it is below 4 percent)! Is today’s environment really 10 percent worse than, or even nearly as bad as, it was in 1982?

The economy may or may not be headed for recession, but “economic feelings” are already in a depression! Even if economic news remains alarming, it is hard to see how “rock bottom” confidence and sentiment could get much worse. This may be the best news there is. At least for investors. Since current economic sentiment is already much worse than even a bad economic reality, the financial markets may offer greater upside and less risk than widely perceived.

So, that's on the one hand. On the other...

A team of Good Shepherd parishioners just served Sunday dinner at the Sioux Falls Salvation Army kitchen. The attendance - over 135 - was a record for that facility.

And I just got news that the average home price in Helena, Montana is $210,000. As another Wells Fargo source put it, "That's due for a correction." In other words, we're still not at the bottom of the housing slump.