Its time to bring out the "we've been nuked" video again, as the evidence on the economy is now conclusive - and undeniable.

There are times I hate being right. That my predictions from last April are now being proved up day by day is one of them.

So this morning The Fed comes in with a big TAF change.

Net-net, its a zero, and it didn't take the market long to figure it out.

The Fed, of course, had the Nonfarm Payroll numbers up front - and they sucked. Headline was negative 63,000 jobs. The private sector lost 101,000 jobs!

Services added only 26,000 jobs, and that's been what has held up the market until now.

This was a clearly recessionary print - there's no argument any longer. We are in a recession; jobs are a lagging indicator and by the time you get this sort of print the recession is already well underway.

This puts reality into the picture in a first-class fashion. There is no more argument about what's going on economically.

We have never had two negative jobs prints in a row outside of a recession. This is a 100% accurate indicator from a historical perspective.

The reason we didn't get a negative print of over a half-million jobs was that 644,000 people GAVE UP during the month of January! Those people do not count as unemployed but they are no longer in the job force!

Do not believe for a second that we have hit the bottom. While the stock market is down 15% from the highs, on average equities lose 30% in a recession.

This means we're only 1/2 way through average losses in the equity markets for a recession, and this recession is likely to be significantly worse than average.

This print also means that we are almost certain to get a negative GDP for the first quarter.

The dollar didn't like all of this one bit, dropping precipitously, with the Yen/Dollar cross headed for parity and the Eur/Dlr cross at 1.54.

We are in a technical area that could lead to the Yen/Dollar cross falling as low as 80!

(Later in the day we saw a technical spike in the dollar index - this does not change the outlook!)

If this situation is not arrested here and now we will see "push" import price increases that will stun the public and destroy the middle class of this nation resulting in cascade failures among other economies that are dependant on exports to the United States, including Europe and Japan, as our buying power for their goods is systematically destroyed.

Of course this didn't stop the relentless "buy the dippers" from being out in force on CNBC this morning. Art Cashin, however, was nowhere near as sanguine - and he's been around a while - long enough to know what the truth is.

BEN BERNANKE - STOP THE GAMES AND FORCE THE BANKS TO TAKE THEIR MARKS RIGHT HERE AND NOW.

YOU NOW HAVE PROOF OF WHAT FIDDLING AND "INJECTING LIQUIDITY" DOES IN A SITUATION WHERE THE ISSUE IS TRUST - IT DOES NOTHING BUT TRASH THE DOLLAR. SIX MONTHS OF EVIDENCE - HOW MUCH MORE DO YOU NEED?



We will not arrest the slide in the dollar, nor the economy, until trust returns. Trust cannot return until those who have hidden things are forced to bring their dead bodies out in public where we can see them. If you do not act soon we will have a currency crisis coupled with a cascading stock market implosion that will force all of this out into the open via global margin calls and mass corporate and banking system bankruptcies.

YOUR ACTIONS THUS FAR HAVE DONE EXACTLY NOTHING TO BRING STABILITY TO THE SYSTEM.

YOUR TIME TO ACT IN A RESPONSIBLE FASHION HAS ESSENTIALLY EXPIRED.

Let's go over the 2007 "Year In Review" predictions again:

• The US will enter a recession if we're not already in one. CHECK - two consecutive negative jobs prints have never before occurred outside of a recession.
• Unemployment will increase significantly, going over 5%. Not yet officially, but if you look at those 600,000+ people who gave up, we'd be well over 5%.
• Housing will not turn in 2008. Still not decided - but I wouldn't make book on being wrong here.
• The story in the housing space will be defaults on "prime" (e.g. ALT-A and other similar) mortgages. CHECK; see the ticker from yesterday.
• The stupidity in the rest of the consumer lending space will come crashing down. Still to be proven, but credit default swaps say this is coming.
• Recreational sectors will get smashed. Check.
• Government will try to meddle in the adjustment of risk and price. Check (this entire rant, plus more, and it ain't over.)
• Buffett will put a stake into the monoline's hearts. Check - the monolines are essentially in runoff at this point as municipalities are either buying from Berkshire or foregoing insurance entirely.
• Equity prices will at least touch 1220 and 1070 is the downside target. In process.
• Return of capital is more important than return on capital. Check. See the treasury market lately?
• No "hyperinflation." So far, check. Commodities have not, however, reacted to this - yet.
• Debt will be paid down when possible and when not, defaulted. CHECK. Hedge funds and so-called "safe" mortgage lenders are blowing up by the day as they cannot deleverage successfully and fail to meet margin calls. This will continue.
• Commerical Real Estate will collapse. Signs of this beginning are already showing up with CRE deals going bad at a frightening rate.
• Business CapEx will slow precipitously. This is starting to show up but hasn't really gained traction - yet.
• The dollar will bounce around before starting to take off. So far, we've not seen people figure out the "rest of world will be ****ed", but if you think the exchange rate problems won't lead to that, you're sadly mistaken. Beware.
• The "market callers" will come "hat in hand". Not yet, unless you count the schizoid Cramer who switches back and forth daily.

A month ago I had three "hits". Today I have four more.

Now compare this record with Ben Bernanke's:

• "Housing will not bleed over into the broader economy." Pull the other one.
• "Inflation expectations are well-anchored." Yeah, right - with headline CPI double your target?
• "We believe FOMC policy is addressing the issues in the economy." Uh huh. This is why the credit markets have seized up eh? You've been real effective with what you've done haven't you?
• "We do not believe we will have a recession." Uh huh, with two negative back-to-back job prints, which historically have a 100% accuracy rate in documenting that we are in, not headed for, a recession. This latter "prediction" is the most odiferous of all, given that it was made less than two weeks ago!

It is time for you to resign Mr. Bernanke.

Perhaps we could have Mr. Hoenig instead? He may be a non-voting member of the Fed this time around, but he's got a brain! Here are a few "money quotes" from a speech he gave today....

2:15Hoenig: Time to end off-balance-sheet "fictions"
2:15Hoenig: Skeptical financial firms can reform themselves
2:15Hoenig: Sees need for sweeping reforms in banks, regulation

I'll be damned. Perhaps he reads The Ticker.