The International Monetary Fund in its latest report warns that the US is headed for recession. And that is regardless of what happens with any bailout package. "The financial turmoil that began in the summer of 2007 has mutated into a full-blown crisis, encompassing broader securities markets and the banking systems of several advanced economies ... based on a comparison of the current episode of financial stress with previous episodes there remains a substantial likelihood of a sharp downturn in the United States, given the similarities between the current dynamics of asset prices, credit ratios, and household financial positions and previous episodes that were followed by recession."

And certainly the numbers and graphs don't look good.

First let's take a look at US house prices.



What that graph says is that US house prices are in free fall, and that amounts to a massive wealth reduction

Secondly, the graph below shows a massive drop in consumer sentiment and spending. And if people aren't spending, it will feed into the rest of the economy.



The graph below is a real worry because it points to a sharp rise in unemployment with thousands thrown out of work

The bailout, at best, might restore some confidence to the markets - but for about 10 minutes only. The world's biggest economy is in serious trouble.