Is the US economy going into a recession?

What does that mean for the USD, what does that mean for US stocks?

Yes, we're going into a recession, but we're already in one in housing. The USD has had it's day and if we're lucky it might stabilize in our lifetime. US stocks that have niche markets, innovation, or that sell overseas, will fare well. The rest of the US stocks are headed for rough roads ahead. With a pre-presidential election year next year, non-US global growth in tact, we should be ok through most of next year, but 2009 is anybody's guess, but I'm not hopefull.

Here's an analogy - In 1900's we became Berkshire Hathaway, and along the way into 2000's we've become Enron.

Here's another analogy. I buy a McMansion on no money down interest only teaser rate adjustable mortgage (maxed out, no equity). I finance a bmw loaded and an escalade. I have several credit cards near maxing out. I keep getting new ones to finance the old ones. Who am I? I'm US. While at the same time my fulltime job was just outsourced to China at 1/4 the pay. My parttime job was just taken over by an immigrant for 1/2 the pay(healthcare costs are killing me but he gets them for free). And yet I spend $T's thinking I need to impose my interests throughout the world militarily. But I don't have $T's to spend, I'm debt ridden, so where does it come from? The bank of China is loaning it to me by buying my debt, and I'm printing money.

Not only is it at an incomprehensible level, it's getting acceleratingly worse and there's no way to stop it. The hanging thread is China needs the US to consume what it makes, and if it starts selling our debt, who will buy it, no one else could afford or would want it, so they keep buying/holding it. There will come a day when China's own market is big enough, and when they no longer need our market, if we tick them off, recession would be an understatement. Or, if housing/sub-prime gets to the derivative pressure cooker level, that could cause it sooner.

Throughout history there hasn't been an empire that hasn't carried the torch (took in more then it spent which lead to it's prominence), and got it to burning very bright before it fizzled out (spent more then it took in which led to it's demise). The torch we're carrying has begun it's last final bright glow before it burns out, while China's is getting brighter every day.

First you have to have an accepted definition of recession.

http://en.wikipedia.org/wiki/Recession

Next, No one can predict the future with absolute accuracy. However, many try to make "educated" guesses.

My guess is; If gas prices, food prices, labor costs, taxes, and all articles needed in everyday living expenses go up, and wages don't go up in relation, yes the whole country could slip into a long recession.

In a long recession, jobs are lost because there is less available money to run a business because people cut back on spending.

When this starts to happen the FED, pumps dollars into the system to keep the overall economy in operation. However, this in turn can further add to higher prices,,,,,which seems to be what is happening right now.

Stocks will go down because there will be more sellers than buyers.

I'm personally investing in physical Gold, betting that the price of Gold stays ahead of the deflating dollar.
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you bet ye, next year.

Yes.

Spend all the money you have. Borrow or steal, and then spend all of that.

File for bankruptcy when you get tired of everybody asking for their money back.

Move to another country and repeat process.

If ai recession means a negative growth rate for the US economy, then most do not think so.

But if it means smaller growth rate, then the answer is yes.

It means USD will be weaker and Dow Jones is unlikely to exceed 14,000 again. It would be wiser to invest in multinationals with world exposure.

Recession is a relative term.

Yes, we will go into recession in the next few years almost for sure. It is the growth cycle. Large gains followed by a period of falling back only to stablilize with and overall gain.

Our economy is very diverse and almost unstoppable, so I am not overly worried.

it means look to hedge funds

It is very doubtful that we will go into a recession. More likely that we will have a growth recession whereby the economy grows but its not enough to keep up with population growth.

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