So... the economy, if not the Dow, is still in the toilet, lots of people are still unemployed or underemployed, and they're hurting. But retail sales are up and climbing. Car sales are way up, as are sales of building materials and clothing.
I'm not an economist or anything, but I'm thinking climbing retails sales may have something to do with the revival of the multi-generational household, i.e. young adults moving back in with mom and dad and older folks moving in with their adult children. Rents are falling too, which means some folks are paying less for housing, and obviously for the employed that translates into more money to spend on consumer goods. But the boom in multi-generational households may mean more people are splitting the costs of housing. Lots of people moved in with mom & dad or their adult children after losing their jobs and going broke, so at first they were a drain and a burden on the folks they moved in with. But when your broke relatives find jobs, they start to contribute to household expenses. And uncertainty—fear of losing that new job—makes 'em slow to move back out. So they stay and continue to contribute to household expenses, freeing up money that would otherwise be going to housing. And paradoxically the recession leaves some folks with more money to spend on consumer items, not less, and retail sales recover while housing remains stagnant.
It'll be interesting to see if some of the choices forced on people by the recession—like the multigenerational household—outlast it. If the multigenerational household returns for good, the effect may be a lasting one.