The facts are clear, we are definitely in the “New Normal.”  Unemployment continues to rest at near 8% and at current rates of employment this is not likely to change.  Even more ominous is that only 60% of the population is in the work force, substantially below the two thirds rate we had until 2007.  And the cause of the poor employment picture is an anemic economy with lackluster performance.  As for housing, my business, at current rates of growth in prices it will take at least 10 more years to regain the price levels of 2007. 

Meanwhile the Feds deficit spending, one dollar of each four spent by the Feds is borrowed, guarantees that we will not see any further massive spending efforts by the Feds to “stimulate” growth.  It will take all the skills Washington has to simply maintain expenditures at present rates.  Thus there is little likelihood that government will be able to alter the “New Normal.” 

I hear lots of calls for the private sector to follow the government’s lead and start spending to boost economic growth.  But the private sector does not see sufficient demand to justify increased spending to expand capacity.  Thus there is little hope to expect the private sector to alter the “New Normal.” 

Face it, we have by sheer inertia arrived at a restructured economy and I mean restructured in terms of what we expect from it.  And inertia promises to keep it like this for years to come.