For those of who believe we are out of the woods or can even see the tree line, let’s look at the following stories that dropped today from above.

Times Online: “Britain’s recession the steepest for 88 years”.

Britain’s economy fell last year at the sharpest rate since 1921, despite hopes that it finally emerged from recession in the last three months of the year, according to a respected economics forecaster.

The National Institute of Economic and Social Research (NIESR) said today that its latest estimate showed that GDP rose by a modest 0.3% in the final three months of 2009 compared with the third quarter.

That means that, for the year as a whole, the economy contracted by 4.8%, a bigger fall than in any year of the Great Depression and the biggest contraction for 88 years.

Let’s jump around a bit and head to Germany.

Wiesbaden — German media is reporting the German economy shrank in 2009 for the first time in six years. With –5.0%, the decline in the price-adjusted gross domestic product (GDP) was larger than ever since World War II. This is shown by first calculations of the Federal Statistical Office (Destatis). The economic slump occurred mainly in the winter half-year of 2008/2009.

Exports and capital formation in machinery and equipment slumped heavily — which shocked all as we have been told those sorts of figures should be doing the opposite as we come out of the recession. Fact is we are not and haven’t been and won’t be while we continue to believe we are. Trust will not get us through. Trust me.

Foreign trade, which in previous years had been a major driving force for growth in the German economy, slowed down economic development in 2009. While exports were down a price-adjusted 14.7%, and 8.9% for imports. Hence, the balance of exports and imports made a negative contribution to GDP growth, as it had done in 2008. However, with –3.4 percentage points, it was markedly larger in 2009 than in 2008 (–0.3 percentage points). Gross fixed capital formation in machinery and equipment was down altogether by one fifth compared with 2008 (–20.0%). Gross fixed capital formation in construction decreased by just 0.7% on the previous year. The only positive contribution in 2009 was made by final consumption expenditure: final consumption expenditure of households was up a price-adjusted 0.4%, government final consumption expenditure rose even markedly by 2.7% on the previous year.

That’s because the poor old consumer believed the government and is now deeper in debt. But not much. The figures are pathetic.

But let’s move on to Laurie Goodman and others at Amherst Securities who has just released a new research note on Option ARMs mortgage resets saying: “Option ARMs have performed almost as poorly as subprime: The cumulative default rate on option ARMs is higher than on any other category of loans except subprime. For 2006 securitised issuance, 61% of subprime loans have defaulted, as have 49% of the option ARMs, 39% of Alt-A loans, and 11% of prime loans.

“The two key problems for option ARMs are negative equity and the coming recasts (with payment shock). Across all categories, option ARMs have more negative equity than other products.” And “most of subprime pay shocks have already occurred, while most of the options ARM pay shocks are yet to come.”

Then Calculated Risk shows the decline in jobs as a percentage of the work force at the peak, finding that, as I wrote earlier this week, the US has lost more than eight million jobs. The decline as a percentage of the workforce is the worst since the Great Depression, matching the sharp but short drop in 1948, as the war machine wound down.

“Equally important, the duration of these job losses, as well as the lack of a sharp recovery (at least so far), suggests that the problem will be with us for a long while. We’re now 24 months into this decline, and we’re still at the bottom. By this point in most previous recessions, we had already recovered all of the lost jobs.

There being no show without Punch, let us cite Ambrose Evans-Pritchard: “The employment situation has to get worse, if, from nothing else, the demographic standpoint. There really are no historical precedents for our present labour situation. Going back to the postwar boom has no relevance to what we are experiencing now and what we will experience in the future. Our dollar, today, is worth 10 cents compared to the 1950 dollar. There are about 30 million more women in the workforce today than there were in 1950. I can’t even calculate how many more illegal aliens are in our present workforce. Additionally, the expectation that our country’s top-heavy generation of fogies will voluntarily leave the workforce is little more than a fantasy. Take our ‘leaders’ in Congress, for instance, the average age of Congressman is 55 years; and of Senators, 60 years.

“The baby boomers, whose leading edge will hit 65 next year, have been conned out of their retirement savings by Wall Street using the invention of the IRA and securities to package up leveraged debt, and have already blown through their inheritances. The only way most baby boomers will leave the workforce voluntarily will be in pine boxes (probably made in China).”

And for those with nothing to do, see Doug Kass’ “Clouds are gathering” or a whole host more, all only a click away when one puts down the newspaper and checks if the black swans are still on the river.