Is the Fat Lady singing?

I've been reading news stories about how Bernanke and others believe the recession is now over. Really? Since when has Bernanke been right? He was wrong about the extent of the housing crisis. He was wrong about the severity of the banking crisis. For that matter, he was wrong about everything so far. So is the economy really improving and is the recession really over? Or is Bernanke really right this time around? I wouldn't bet on this.

I'll layout the primary reason why. In the first quarter of next year, we will have one of the highest reset of option ARM. These are the type of mortgages where individuals pay a small fixed monthly payment initially but will start paying in most cases a higher monthly payment after their interest rate resets. We've already seen what a catastrophe these types of loans have been and the number of foreclosures will only increase as another wave of loans are reset to higher rates. Consumers will not be opening their wallets anytime soon. i.e. The economy will not pickup without an increase in consumer spending unless of course, people decide to go on another credit spending spree. But we all know the credit has dried up. Majority of home owners have no equity in their house and can't refinance. It's seems like it's a death spiral slowly spinning out of control. I don't see how the economy can improve with the next wave of foreclosure looming.

I hate to be the bearer of bad news. But the recession is not over and the Fat Lady is not singing.