Here is a presentation using readily available data from the Federal Reserve and BoomBustBlog illustrating what clearly shows we have not come anywhere near the peak of the economic downturn IF you believe that real asset prices, economic housing activity and bank lending and available credit are gauges of, and effect, economic health.

Since the loan peak of 7.3227 trillion for week ending 10-22-08, total loans and leases at banks have dropped over 500 billion dollars.  That big spike on April 1st was due to an FASB rule change that forced some 452 or so billion in off-balance sheet stuff back on their books.  Basically, this was not new lending, it was lending that was held off balance sheet. Despite the stimulus that was supposed to increase lending, the current total loans and leases is now at 6.7889 trillion.  This is a drop of $533.8 billion.  Not counting the +452 to 515 billion resulting from that rule change, the drop is ~1,000 billion.  In other words, we’ve had total loan retraction in the amount of nearly a trillion dollars since the bailout – green shoots, end of the recession, no chance of a double dip (because we never left the first one) and all. Unbelievable.

Let’s put this in context by referencing “Are We In a “Banking” Depression?” Friday, October 1st, 2010

Next, we take a look at the REAL housing situation… Those Who Blindly Follow Housing Prices Without Taking Other Metrics Into Consideration Are Missing the Housing Depression of the New Millennium. Monday, October 4th, 2010

Enough of the free stuff. Subscribers (click here to subscribe), be sure to go through my housing models and bank analysis from the past month. Morgan Stanley, Wells Fargo and Sun Trust are up on tap. I will be releasing out proprietary foreclosure and shadow inventory report for professional and institutional subscribers by Monday, possibly over the weekend, as well advanced views of GS and JPM from a balance sheet perspective. This is very valuable information and analysis to plug into your bank assumptions.