Bill Bonner, c0-author of The New Empire of Debt and daily columnist for The Daily Reckoning, UK Edition, offers his analysis on the state of the global economy.

This recovery is wonderful in every way, except the important ones. It is like a shiny new airplane. It has glossy aluminum wings. It has plush seats in the first class section. Trim stewardesses serve drinks. Movies are available on demand in all sections…

With unemployment hovering at 9.4% consumers continued to show reluctance in July as incomes stagnated. Furthermore, with the jobless rate expected to exceed 10% later this year, consumer confidence fell in August, keeping hopes of a sustained economic recovery at bay.

European shares touched a 10-month high on Friday on optimism for a global economic recovery and with Nokia and results from U.S. bellwethers boosting the technology sector.

While the many of the world’s economies continue to look for signs of growth, the U.S. economy took a big step in the right the direction in the second quarter.

The dollar fell against the yen on Friday after a government report showing a slower-than-expected contraction in the U.S. economy in the second quarter was offset by a decline in consumer spending.

Oil fell below $66 on Friday, in line with broad falls on global markets after data showing the U.S. economy contracted and consumer spending had declined, with knock-on effects for fuel demand.

The economy continued to show signs of recovery from the worst recession in 60 years as the total number of Americans receiving unemployment benefits dropped for the first time since January, the Labor Department reported yesterday (Thursday).

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