The World Bank yesterday (Monday) lowered its growth forecast for the global economy and warned about a long and painful recovery in developed economies, underscoring the recent supposition by many analysts that a three-month rally in U.S. stocks has been overdone.

Is the crisis really over? Commercial paper spreads have come down dramatically. Libor rates are (hmm – almost) back to normal. Even high yield spreads are narrowing.

Despite the worry of a flu pandemic, a unexpectedly large contraction in US GDP and a recent prediction by the IMF that US banks’ loan losses would top $2.7 trillion, the world, as Justice Litle puts it in Taipan Daily, “is pounding the table for a V-shaped recovery.”

In the currency market, the dollar continued to fall against the euro. Late Wednesday, the euro was trading at $1.3264 vs. $1.3141 on Tuesday.

Geithner sends the dollar on a thrill ride…  A failed UK gilt auction…  China set to recover first…  AUD and NZD rally again… And Now… Today’s Pfennig!

Back in December, with the U.S. recession in its 12th month – and showing no signs of abating – Money Morning Contributing Editor Martin Hutchinson warned that an “L”-shaped recession was very possible.

Investing bearish right now could help protect your savings.  And just like fellow contrarians have been telling you all along, Ted Peroulakis suggests you broaden your horizons into contrarian investments like gold and silver.

U.S. gross domestic product (GDP) contracted at a 6.2% annual pace in the fourth quarter of 2008, the most since 1982, the Commerce Department said Friday.

This recession isn’t like anything we’ve seen previously. Even I’ve cut back on the egregious amount of fast food dining I do in the face of deflation.

Is Washington replacing New York – and more specifically, Wall Street – as the city that drives America?