Green shoots in the US Economy and the Perfect Storm
There is a lot of talk in the media about so-called "green shoots" in the US economy after (Helicopter) Ben Bernanke first mentioned how he was seeing these "green shoots" of economic recovery in mid-march. I think it is a little early to be considering any form of "new growth" unless Ben was referring to the enormous growth in the US government spending (and the Fed's own balance sheets). I do not know that much about gardening but what I do know is this: when all the plants in my garden have been dying for months now and then they are suddenly dying a little bit less - I would not yet call this a sign of "green shoots" or that anything in my garden is "blossoming". I do have to say that it feels like perfect orchestrating by the US government: fool the fools (in the market) that recovery is on its way and then let them capitalize the banks.
On a weekend get-away in Luxembourg these past couple of days, we ran into a nice cartoon(contest) exhibition with a "green economy" theme (environmental). A few of these reminded me very much of the current crisis and of these much debated "green shoots".
The financial crisis has sometimes been referred to as the "Perfect Storm" and right now we might be in the "eye" of the storm. The drawing below at least visualizes the much-needed "deleveraging" of the financial system.