Update: The Dow closed above 10,000. Many people are breathing a sigh of relief. In the meantime, the Crash Alert Flag is flying high at The Daily Reckoning offices in London. They're the folks who don't believe this rally is sustainable.

The economic indicators in The States don't point to any economic recovery. But don't you be the spoiler for the folks on Wall Street. They're too busy celebrating.

Feature Article: Designing Your Personal Recovery

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What Recovery?

On Monday October 12th, the Associated Press reported that over 80% of economists surveyed said the recession is over and a recovery is beginning. Isn't that rather odd? Where were these so-called economists last September when everyone's portfolios saw losses of 30% or more?

I hold a contrarian view on the economy. Here are a few words of light from chief contrarian Bill Bonner, co-author of Financial Reckoning Day and author of Empire of Debt posted on his daily newsletter, The Daily Reckoning:

Then, word came that even Alan Greenspan thinks a recovery is underway.

"This is what a recovery looks like," said the maestro (Greenspan). That settled the matter as far as we are concerned. Alan Greenspan didn't see history's biggest financial bubble until it exploded in his face. In the following few words we undertake to show that Greenspan is as blind as ever.

"Great time for US consumers, America is on sale," says an item at YahooFinance. The "discounts are unbelievable," adds a blogger known as Frugal Rhode Island Momma. All across the nation, merchants are no longer selling the merits of their products; they're selling price. McDonald's advertises its "dollar meals." Hotels have cut room prices by 20% in the last year. House prices are down about 30% since 2006. Sellers are offering bargains and they want buyers to know it. "Sold for $365,000 in 2006. Now $195,000," says a typical house ad.

It is a deflationary world, at least that part of the world between the Rio Grande and the 49th parallel. The CPI in the United States is negative and falling faster than at any time in 59 years. Households can only be induced to spend money by cutting prices. "Cash for Clunkers" cut prices on new cars by about 20%. As soon as it ended, so did auto sales. Most new house sales could be traced to a tax credit - which reduced the down payment by at least 20%. That program is scheduled to end in November.

The banks are happy to play the government's game too. They can borrow overnight money from the Fed at only one quarter of 1%, annualized. But lending to small business is hard work. And it is risky. Why bother? The US Treasury will pay them 4 % for lending back to the government, long term. This is practically free money to the banks. Both the bankers and politicians end up ahead - with a bigger piece of the economy under their control.

Meanwhile, the real economy staggers. "Drought of credit hampers recovery," summarizes The Wall Street Journal. The United States needs to create a million and a half new jobs each year just to keep up with population growth. Currently there are 15 million people without jobs already...and a couple hundred thousand more unemployed every month. And if this recovery continues long enough there won't be a single person left in America who still has a job.

Designing Your Personal Recovery

Dear Associate,

Here's a thought-provoking idea:

If you don't like the picture you're seeing — change it.

You're not a tree. You CAN do something about it. Most people don't. Or even worse, won't, suggesting a willingness to remain in limbo. Choose not to be among them.

This isn't about the pictures in your camera or on your television. Let's go further inward. I'm talking about the pictures that shape your life. The ones you see every single day in your mind's eye.

If you're consumed with a financial crisis, unemployment, or losing your home — you're out of harmony with your true greatness. I believe we were born with the talents to overcome all sorts of personal crises. You have the power within to turn negative situations into positive outcomes.

Let's look at three keys of designing your personal recovery:

1) Change your mental video. This is the major key. If there's one success key to practice in life, this is it. All you have to do is replace the negative DVD that's running in your mind with a positive one.

Now this may sound simple, but it can be quite challenging. Because when you're not looking, somebody else (maybe it might even be you) reinstalls the negative DVD back into your player. Which means you must constantly reinstall your positive picture.

Something extremely negative happened to me a while back and I couldn't get it out of my mind. I kept seeing the same negative picture all day long. Then I carried that same picture with me to bed. And guess what picture was playing when I woke up in the middle of the night?

Yes, the same one.

This went on for months. I got very little sleep, was idling through life and I wasn't as productive as I should have been.

Then I decided to replace my mental DVD. I decided to play the new, positive DVD all the time. That's when things began getting better for me. That's when my focus returned. That's when I started getting my game back.

2) Get involved with positive people. This is important. You wouldn't want to hang around with victimhood friends. All they'd want to do is find someone or something to blame. You'd get a lot of attention, but it's not the healthy kind.

Instead join those who are proactive in worthy causes. Become a member in a hobby group or club. Be emotionally available for others seeking their personal recovery.

I've been thinking about joining a non-profit group designed to help educate and administer healthcare to people on another continent devastated by hunger, hatred and violence. There's a lot of suffering in this world and I want to make a positive impact to reduce it. Whatever you decide to get involved in, make it your goal to join a positive crowd.

3) Take action. Get physical. Do something enjoyable that will take your mind away from all the negative stuff.

Go dancing, hiking or bicycling. Join a yoga or fitness class. Do something on the wild side that you were always too shy to try.

I spend an hour a day working on my fitness routine. I play basketball twice a week. I try to strike up a conversation with people I barely know. The rewards are huge.

Designing your personal recovery is not as hard as it seems, but it doesn't happen overnight. You begin by shifting your thinking. And always remember: Positive ideas flow from positive thinking.

Warm regards,