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Do 'green shoots' signal end of recession?

Economy watchers have been talking about "green shoots" of recovery in the ruins of the recession. Bloggers aren't so sure.

At the Progressive Economics Forum, Erin Weir warns that "despite expansive monetary policy from central banks and perceived 'green shoots' in the economy, deflation remains a more serious risk than rising inflation."

At Cliff Küle's Notes, a graph shows the green shoots as a small, brief rise after a long, steep fall.

At Whispers from the Village on the Edge of the Rainforest, "Whisperer" worries about the Vancouver real estate market:

Province-wide, the [CMHC] forecast calls for a 43-per-cent decline in housing starts compared with 2008. It estimates that builders will start work on 19,725 new housing units this year, with a 10-per-cent uptick to 21,000 new units in 2010 -- a far cry from the 34,321 built in 2008.

...Are the fundamentals there for recovery? Or are the 'green shoots' actually the yellow weeds of a bear market trap? takes the weed metaphor even further:

The "green shoots" of the economy are really red roots evidenced by a labor market stasis and plummeting earnings. Chairman Bernanke told '60 Minutes' on Sunday that "green shoots" of economic resurgence are sprouting. But those perceived green shoots are really red weeds that the Federal Reserve has internally debated for weeks. The economy is grinding to a halt, the FRN$ is under intense pressure and beginning to buckle again while gold is predictably playing its role.

And at ActionForex, today's European Market Update offers little encouragement:

Hard data not confirming any "green shoots" at this time; Japan April steel output -43.6% y/y; HK GDP below expectations and the HKMA noted that no recovery in global economy seen soon. IMF: more UK banks may have to be nationalized. FOMC Minutes: Deeper recession possible.

Early this morning, the Globe and Mail reported that "Stocks slump on U.S. jobless data."

Crawford Kilian is a contributing editor of The Tyee.

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