"There is a reasonable prospect that the current recession will end in 2009"

I don't think a recovery is likely, but I do see think it is not unreasonable to say we might hit bottom in 2009. Assuming Geithner and Bernanke play their role as end stops, and let a few more firms fail without letting the repercussions get out of hand, I could conceive of hitting bottom this year. Of course, I could also imagine AIG failing and setting off another round of failures that will send us even even lower.

It's easy to get hung up on the micro and focus on the situation in the U.S., but you have to look at the macro too and see that there are market forces way beyond the control of any government.

There are many shoes left to fall.

It's going to be interesting to see what becomes of the AIG situation and what type of fallout will result from it.

i know in real estate markets ppl are waiting for the tipping point when the bid-ask spread between buyers and sellers finally aligns. once there is some clarity on what the hell anything is worth, transaction activity will bust open and it will signify the beginning of the end. ppl are saying that spark will occur sometime in Q3/Q4 2009.

You have to read between the lines when figure-heads like Bernake speak, obviously he has to make sure he doesn't cause more panic in the financial markets. Its when he says things such as (I'm paraphrasing) "the downside risks far outweigh the upside." Essentially he is admitting this statement about recovery towards the end of 2009 is very optimistic and dependent upon a string of events which all have a pretty high degree of uncertainty themselves.