Now that the government has bailed out Wall Street, the Banks, the insurance companies, the auto makers, and countless others, the real question is “Is it enough?” What needs to be done to get our economy back on track? Are we on the verge of being “back on track”?

The latest Forbes magazine refers to the “Depression on the Fourth Quarter” and is cautiously optimistic about improvements possibly already underway. They refer to their Chirps Index and are hopeful.

See http://www.forbes.com/forbes/2009/0112/037.html

The index referred to above is a great index. Its optimism is refreshing and encouraging. We all hope that things get better from here.

After all the government assistance and economic support, there are two pillars of our economy which are still faltering. One pillar is comprised of the over-leveraged homeowners and consumers who have no option to refi their mortgages at today’s attractive rates due to excessive declines in the values of their homes or in their credit scores.

The other pillar that has seen no support from political or economic leadership is the small business owners. Millions of small businesses were decimated in the Mini Depression of the 4th Q, due to revenue fall offs of 10-90% and the drawing down or elimination of available credit by those “saved” by Uncle Sam. Many of these millions of small businesses, employing between 1 and 10 employees are on the verge of closing their doors, filing personal and corporate bankruptcy and becoming wards of the economic state. As the US economy and its economic growth over the past 20 years has been powered by our small businesses, their mass genocide due to the economic environment will be costly and painful.

There is an estimated $2 trillion of potential defaults and write-offs that could result from further deterioration of the remaining two pillars.

Hopefully, new leadership in DC will force the hand of the beneficiaries of the government’s handouts and cheap money to assist (1) the homeowners and consumers and (2)the small businesses of America.

If these two pillars falter then the “Chirps” the new index is hearing are just echoes of chirps from the past.

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