Is the government creating another subprime-mortgage bubble?

You wanna know what is going on? David Rosenberg explains…

Looks like another government arm will soon be knocking on the Treasury’s door: “We are currently considering all options, including borrowing from the Treasury,” said FDIC chairwoman Sheila Bair. As we’ve forecast many times, the steady collapse of banks around the U.S. has put an irreparable dent in the FDIC deposit insurance fund.

Let’s get this straight.

Household credit is shrinking…
Profits are shrinking…
Employment is shrinking…
Housing values are shrinking…
The wage base is shrinking…

But the recession is over!

Whoa… how is that possible?

Gold took off yesterday…closing at $1020. Here at The Daily Reckoning, we’re impressed. But we’re not that impressed. Gold, of course, is half of our Trade of the Decade, which we announced almost 10 years ago. We’re bullish on the metal…have been for a very long time. But recent comments in this space have made readers wonder what the Hell is going on…so we will spend a few minutes clarifying.

Amazing. A few weeks of “Cash for Clunkers”…700,000 new cars off the lot…et voila: Retail sales jumped in August by the most in three years! Wee-hoo!

“I’m Brazilian. I have gold. And I’ve just arrived from Rio richer than anyone…” Thus sang one of the characters in an operetta by Jacques Offenbach. But that was in the mid-19 th century. But hey… what goes around…

U.S. Federal Reserve Chairman Ben S. Bernanke said yesterday (Tuesday) that the worst recession since the Great Depression is “very likely over.” However, Bernanke also said that unemployment would remain high and keep the recovery from accelerating.

It was one year ago that Lehman Bros. went to the great investment bank in the sky. But it was also when the feds arranged the shotgun marriage of a failing Merrill Lynch to a moribund Bank of America (NYSE:BAC). And AIG’s collapse into federal hands was taking shape, if not yet a done deal.

This week marks the one-year anniversary of the Lehman bankruptcy. The media struggles to say something meaningful about it. Here at the Daily Reckoning we will not even attempt meaningfulness. We’ll be satisfied with a few snide remarks.