Where's the Recovery?

The stock market has rallied in a HUGE way, the government and media are telling us the worst is over, but is it? Personally, I haven't felt any recovery. In fact, I've got a whole new round of friends that have lost jobs in the last two months.

In a recent article posted on CNN, Ian Shepherson, Chief U.S. economist for High Fequency Economics, said:
"The big story is the core [retail sales]. Excluding autos, gas and food, sales fell 0.4%. That's the fifth straight decline," Shepherdson said. "People are cash-constrained and credit-starved. Remember, their spending accounts for 89% of private sector GDP."

Consumers are spending less money because they are afraid for their jobs. Nouriel Roubini, on Forbes.com, had this to say about the job situation which has recently been reported to show improvement:
The decline in the unemployment rate from 9.5% in June to 9.4% in July was not due to an improvement in the employment situation but is explained by the large decline in the labor force (-422,000). Workers facing hiring freezes, fewer full-time jobs and jobs at lower wages are leaving the labor force.

"Leaving the work force" is a reference to the fact that after too many months of being unemployed we simply stop counting people as workers. Instead, we say they have "left the work force". So last month, the number of people that "left the work force" was 422,000.

The job situation is terrible, people aren't spending, but the government is still saying:
"We're probably looking at a turnaround in GDP before the end of the year, so then we'd expect jobs to normally start growing shortly after that," said Christina Romer, President's Council of Economic Advisers.

So while the some talk recovery, I'm left wondering what we are recovering. American households lost $14 trillion in wealth in the last 18 months - that amount is greater than one year of our country's Gross Domestic Product (GDP - a measure of the value of EVERYTHING produced in this country).