Are you saying that the past recessions attributed to declining car sales were due to layoffs among the Big 3, and that this time those employees will be rehired by foreign auto makers?

However, the decline in new car sales is for all new cars, even foreign cars, and it shows that consumer spending is slowing. So the important point about this is that consumer spending is slowing, beginning with the big ticket items like houses and cars, and now we hear Home Depot’s sales are down 5% and they see a slump for all of 2007 at least, Walmart’s sales are down, and the unemployment in housing industries is expected to go high and ripple through the economy. (Majority of new jobs created in the last few years are housing related).

lindismith got an early start on preparing her company for the recession, and has increased her sales because of it. My family is living with the recession in mind, as far as our spending, investing, and jobs are concerned.

If you think this housing bust will not cause a recession, then the burden of proof is on you. How can the economy keep growing in the face of the housing bust? Q3 GDP was 1.6%, and that was when housing starts were still going strong. Now they have declined big time, and almost certainly GDP will be 0 or negative in Q4, as the lower housing permits and starts are reflected in even lower residential investment in Q4. This will ripple through to retails, high tech companies, manufacturers of all sorts.

I am not sure if the rest of the world will decouple from the US recession. It could go either way.