Wall Street is indicating that the recession probably bottomed during the second week of July. They are seeing confirmation of this in the profits reported recently for 2nd quarter--the losses are not as large as expected and where there was a profit it is generally better than expected. They are seeing confirmation in the unexpectedly great willingness of consumers to take advantage of the $4500 government rebate to purchase more fuel efficient cars. They are seeing confirmation in the unemployment numbers for July being significantly smaller than the numbers for June. They are seeing it in the housing numbers that showed an increase in the sale of both new and pre-owned homes over the previous month plus the first increase in sale prices since 2006. Ford is running some overtime on their assembly lines, which is a precursor to rehiring laid off workers.
Is this the whole story? No. We will still have to weather the collapse of the commercial real estate market. That is only at its beginning because there are too many businesses that have closed and too much space that has been built even in the past 24 months, so there is a huge amount of unleased space and no rent means no mortgage payments. Within the past few weeks the Watergate (Watergate Hotel of Richard Nixon 'Watergate Scandal' fame) in Washington was sold at foreclosure auction. There was only one bid entered--$25 million--and that was what it went for. The facility would have sold for 5-6 times that much 24 months ago.
On the other hand, my son who has been laid off since March is seeing a lot more jobs posted in his field and after months of hearing nothing from anybody, has had 3 'preliminary phone screens' this past week as companies get it in gear to cherry pick the talent out there on unemployment. My significant other has been laid off since April and he has been invited to 2 interviews this week that were not 'cattle calls' where 100-200 people show up to fill out applications in person under the guise of it being an "interview". Last night he did a special job for one company and shortly after submitting an invoice today by email, they emailed back a tentacle asking if he would be interested in more work on a regular or even employee basis. It is going to take a long time to create enough jobs to get the about 10% unemployed back to work but the process I believe has started. The question is whether recovery will come first to those areas of the country that went down first or the ones that went down last.