What economic recovery?

I don't have the time or training to identify whether or not we are in the midst of recovery, so I try to leave that to the professionals. To that end we have Professor James Hamilton at the informative though somewhat technical Econbrowser (it is replete with charts and graphs which are helpful, I just have to skip the equations with the greek letters in them). The professor takes a look at some of the latest data then ends his post on this somewhat bewildered note:

So maybe we could summarize the recent strength in the leading economic index this way. The main reason we think the economy is improving is because many of us think the economy is improving.

Yes, maybe we could. But as Hamilton points out, stock prices are the leading contributor to gains in the index and stock prices are driven by what people think will happen. The fact is that there is little in the way of objective economic data that is pointing toward recovery. Of course in saying this, the professor tends to employ careful and prudent language.

Those of you that prefer your economic predictions and pronouncements with fewer adverbs never fear!

As recently as Monday, The Winning McCain gave us this:

The recession will get worse, not better, as a result of their policies. After a three-month "sucker rally," the markets are sobering up to the fact that the fundamentals suck. Hello, Weimar America.

It's true that R.S. McCain is not an economist, though he occasionally plays one in the blogosphere. Regardless, are both of these gentlemen actually making the same point? If so, to paraphrase Twain, news of economic recovery may be greatly exaggerated.