The downside of optimism

It was only a matter of time before the perma-optimists came back in force. Step forward several analysts predicting a record year end rally for the S&P 500. Yet a bit of rational thinking pours cold water on that theory.

Optimism is a real liability right now, as it's a comfortable refuge from the facts - things will get a lot worse. Right on cue, Circuit City (a good retail bellwether...or should that be clunky shell?) came clean that it's game over.

I'm not saying that a positive attitude is a bad thing. It's the engine that drives free enterprise and productive labour - but calling the end of our woes now is simply delusional. The sooner we come to terms with the true scale of our problems, the quicker we might (just) be able to address them before it's too late.