Anyone who thinks the deficit is too high and that the government is spending and borrowing money excessively should go look at the chart and article posted by Jonathon Taplin. Foreclosures are increasing a great deal more rapidly than home sales. That's one major warning of more economic trouble coming.
The problem right now is not inflation and a government deficit. It's a depression that his being held off by the federal government.
Consumers do not have the money to spend, the banks are not expanding credit, and the private markets have completely failed to be able to support a society as large are the United States. The Government spending is the only thing keeping a lot of people in business.
Economically the U.S. is in uncharted waters and no one knows exactly what to do about it, so everyone is hunkering down and trying to find ways to protect their own backsides right now. The only positive notes are coming from the perpetual optimists who are trying to sell their wares. That's the source of the media economic happy talk. It's whistling past the graveyard right now.
What's disgusting about this is that the Republican Party has become the political party of "NO!" in an effort to regain the power that they lost by creating this economic disaster. They offer nothing positive that might solve the economic problems. Instead they are working to obstruct everything that is proposed that might work so that the government will fail to bring America out of the economic crisis. Only if the Republicans can orchestrate a complete failure of government will they possibly be able to return to power in this coming generation. The majority of the public appears to be on to them, however.
In any case, though, don't expect the economy to recover this year. It won't. It can't. There is no expanding consumer market for businesses to grow into, and without that there will not be a significant reduction in unemployment which would allow the money to consumers to buy more. So when you hear "Economic Happy Talk" in the media, just ask what they are selling and ignore what they are saying. It's another desperate used car salesman at work.