Economic "green shoots" turn brown

Monthly foreclosures break another record, and retail spending drops again. What's the connection? Jobs, jobs, jobs.

By Andrew Leonard
Published May 13, 2009 2:06PM (EDT)

Those green shoots that were getting the economic recovery optimists so hot and bothered? Consider them withered.

The news that U.S. foreclosures broke a record for the second straight month and retail sales declined "unexpectedly" in April will put a serious damper on expectations of any kind of meaningful economic turnaround in the near future. The relatively upbeat performance of consumer spending in the first quarter of 2009 is looking more and more like a mirage.

Both economic indicators are likely influenced by ongoing job losses. The connection between a layoff, corresponding failure to make one's mortgage payment, and eventual foreclosure is hard to miss. And while the pace at which the economy is shedding jobs may have slowed, consumers are still clearly anxious about the future, and keeping a firm grip on their wallets.

Meanwhile, the New York Times wrings its hands at how slowly stimulus money is trickling out. But at this point, maybe it's a relief to know that more than 90 percent of the funds have yet to be disbursed. Because it sure looks like we're  going to need it.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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