Demand from overseas for U.S.-made products is helping to keep factories running even as spending by American consumers and businesses slows. The improvement signals the U.S. may be able to avoid a deep and protracted economic slowdown as the housing slump worsens and food and fuel prices soar.

“Worries over a US recession are turning into fears of inflation,” says William Patalon III in Money Morning.

“And suddenly those increased water cooler discussions about the dreaded “I” word are starting to move from speculation to reality. Dow Chemical announced a 20% across the board price increase to “mitigate the effects of raw material costs.” German-based DHL soon will be “outsourcing” its North American delivery biz to competitor UPS as its seeks to reduce costs. Discounter airline JetBlue will not be adding to its fleet as expected because it too suffered the ill-effects of rising fuel prices that have prompted major changes throughout its industry (can you say consolidation?). Likewise, automakers continued to struggle from consumer activity (rather inactivity) as both Ford Motor Co. (F) and General Motors announced major reductions to their respective workforces.”

“My friends and I have been debating the ‘recession’ topic for a while now”, says Wayne Mulligan in The Penny Sleuth. “Are we currently in one? Will we run into one this year or next? What will the effects be?

“But when I read that Warren Buffett thinks the US is already in a recession and it will be ‘longer’ and ‘deeper’ than any we’ve seen for quite some time, I definitely began to think less about ‘what if we go into a recession’ and more along the lines of ‘What should I do with my money now?’”

Click here to find out which recession-proof discount retailers Wayne reckons are worth digging into.