While there are many factors influencing the economy which will determine how deep the current recession lasts, eight come to mind that illustrate just how much trouble we may be in. The government, the banks, corporations, and consumer spending habits will all combine with the corruption in the housing and mortgage lending markets to keep the economy on shaky ground for quite a while to come.

First, the federal government has been inflating or borrowing money like it is going out of style in order to nationalize corporations and transfer wealth from the people to banks. None of the money that is being provided from the various Federal Reserve programs or the bailout has been adequately accounted for, with banks even refusing to supply information regarding what they have done with the money they have stolen from taxpayers.

The complete collapse of Wall Street and the financial industry has also contributed enormously to the depression. These financial firms created instruments designed to hide money and confuse buyers, a fraudulent scheme perpetrated on the entire world through CDOs, ABSs, MBSs, and more. Once it became clear what kinds of debt were contained in all of those SIVs and other acronyms, the entire facade collapsed, taking much of Wall Street with it.

But this vast handout of money to bail out Wall Street and the banks has not even helped stabilize the financial markets. While credit is growing again, the impoverishing of America to bail out the lenders has meant that credit markets remain tighter than they were years ago. Of course, this is a good thing for most consumers who were taken in by the free money and borrowed more than they would ever be able to pay back.

Fourth, consumers have been tapped out for years now and have been borrowing money on credit cards and Home Equity Lines of Credit in order to replace old debt with new. But now that consumer lending has dried up, these market segments can no longer continue to pay their previous debt bills with more borrowed money. Defaults, foreclosures, and bankruptcies will continue to be the result.

The housing market is not helping the situation, either. Home values were pumped up beyond belief by easy money from the Federal Reserve flowing through Wall Street banks into subprime mortgage towns. Now prices have collapsed and are falling by the day, in some areas by as much as 40% or more. Huge tracts of land are left undeveloped in Florida, Detroit is an abandoned wasteland in some area, and California is seeing real estate prices fall by the hour. Values are almost impossible to accurately determine.

This has caused a near complete collapse of lending in the housing market, and the tapped out aspect of most borrowers has caused a further collapse in other consumer lending. This is one reason why GMAC, the lending arm of General Motors, needed a bailout from the federal government in order to lower its lending standards again to be able to sell more cars to people who can not pay for them. All such schemes to stimulate borrowing and spending will only lead to more failures and bailouts.

Extraordinary numbers of foreclosures are also contributing to the problem. Why would anyone want to buy a new house when foreclosed homes of every variety are sitting vacant in large numbers? Until this inventory is further liquidated, home builders will have to wait on the sidelines. But of course, the inventory can not be liquidated at today's high prices and with banks no longer providing home loans for people who can not afford to make mortgage payments. Thousands of houses were permanently constructed for families who could only afford to take a temporary break from renting. Now these homes remain foreclosed and abandoned.

A deep recession will keep the economy down for some years, as the government tinkers with one bailout or regulation after another that prevents the market from liquidating bad debt and insolvent companies. As the depression deepens, politicians, the banks, and failing corporations will kick the can a little further down the road. The end result will be a steeper, longer decline that if the economy just took the bad medicine right away and got on with supporting good companies, instead of being forced to prop up failed institutions.