One reason this downturn (call it a recession if you want) is so bad iss because people's "wealth perception" is so low right now that they are not spending.
The house is not appreciating at 15%/year anymore, the stock market is down, banks have cut their Home Equity lines of credit. People are spending less, especially on credit cards, because their limits have gone down.
The consumer is having a hard time "spending us out" of this recession. Almost makes you think trickle down economics might have a grain of truth. (that statement is intentionally ambiguous so you don't know what I really think). They actually say that when the tax rebate effect wears off things will probably get eeven worse. This is one of the worst economic times I can remember.