Marie Cocco: A Rebound Without Recovery

from Truthdig:



A Rebound Without Recovery
Posted on Jul 28, 2009

By Marie Cocco


So is there good news, or bad? Are we poised for an economic rebound or are we perched on the edge of another unnerving cycle in which Wall Street analysts—along with politicians with a huge stake in talking things up—try to chat us out of our funk?

Goldman Sachs, fresh from returning the $10 billion infusion of taxpayer money that helped keep it afloat during last fall’s credit crisis, posted a record-breaking $3 billion profit in the second quarter. That’s enough to dedicate nearly half the firm’s revenues to compensation—that is, to the eye-popping salaries and obscene bonuses that we’ve been led to understand were one cause of the financial and economic meltdown. Nonetheless, Goldman’s good fortune is good news for New York limo drivers, landscapers, bartenders, nannies, real estate brokers and home-improvement contractors. Sometimes a torrent really does trickle down.

Meanwhile, Wall Street analysts are raising profit forecasts for U.S. companies at a pace not seen since April 2007, according to the Bloomberg financial news service. So things are looking up if you’re an executive who can boast of achieving those fatter profits, or even if you are a middle-class investor worried about your retirement portfolio.

But then, there’s Staples.

The office-supply chain sent me an e-mail advertisement just the other day boasting that it is offering 25-cent specials on some back-to-school supplies. Glue, pencil sharpeners, erasers, pens, pencil cases—a quarter is all it takes.

As a leading economic indicator, I’m going with Staples. .........(more)

The complete piece is at: http://www.truthdig.com/report/item/20090727_a_rebound_without_recovery/