• We're looking a recession, my friends.

    I don't know any other way to say it.

    Not slowing economy.

    I'm talking "going in reverse" economy.

    The clincher for me was a key manufacturing gauge out today that showed factories contracting for the first time in nearly three years.

    The institute for supply management reporting its closely watched index dropped to a reading of 49.7 percent in June from 53.5 percent in May.

    I know gobbledy-goop to a lot of you. Very telling, to me, and part of a worrisome trend for all.

    Here's why...manufacturing tends to lead us out of recessions, and had for a while been leading us out of the last one.

    Not now...not with orders down, and consumers clearly reluctant to spend.

    Personal spending numbers soft.

    Retail sales really soft.

    ...which could explain why another closely watch prices-paid index is dropping...that usually happens when demand is dropping.

    Like it's been happening for oil prices. And gas prices.

    Not just here. Everywhere.

    Global demand is down because the global economy is down.

    And since the recovery here hasn't been much to write home about...you can imagine this ain't good news for homes either.

    ...also borne out in most data that continue to show homebuyers nervous...and lenders cautious.

    So that Mexican standoff remains.

    Here's what also remains: a Europe still a mess...and a once promising market there still a basket case.

    My boss Rupert Murdoch said so himself on this very air...like his counterparts at McDonald’s and 3M and Goodyear tire and rubber and Cisco and so many others, a big mess there...so they're all pulling back a bit there.