Just how bad is the economy, anyway?

The answer is really freaking bad.

Dragged down by plummeting automobile sales, retail sales fell by a record amount in October, the Commerce Department reported on Friday.

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Consumer spending accounts for two-thirds of total economic activity and weakness in this area was the major factor dragging down overall economic growth in the July-September quarter. The gross domestic product fell 0.3 percent at an annual rate during the third quarter, the strongest signal yet that the country has fallen into a recession.

Many economists believe the G.D.P will drop by an even bigger amount in the current October-December period and will continue falling through the first two quarters of next year. They are expecting that the financial crisis, the worst in seven decades, will produce the country’s worst recession since the 1981-1982 downturn.

The government reported last week that the unemployment rate shot up to 6.5 percent in October, and many economists believe it will top 8 percent before the economy starts to mount a sustained rebound.

And as bad as it is here, there is lots of pain to go around.

PARIS -- The economy of the euro zone slipped into recession for the first time during the third quarter, the European Union’s statistics agency confirmed Friday, as the financial crisis continued to depress manufacturing activity and consumer demand.

Gross domestic product declined 0.2 percent in the third quarter from the previous three months in both the euro zone, which comprises the 15 countries that use the euro as their currency, and the European Union as a whole, according to an initial estimate published by the agency Eurostat. The weakness in the third quarter was particularly marked in Germany and Italy, both of which have technically entered a recession with G.D.P. contractions of 0.5 percent from the previous quarter after a similar decline in the second period.

Paul Krugman says that it is time to get on the Keynesian horse and ride it for all it is worth.

To pull us out of this downward spiral, the federal government will have to provide economic stimulus in the form of higher spending and greater aid to those in distress — and the stimulus plan won’t come soon enough or be strong enough unless politicians and economic officials are able to transcend several conventional prejudices.

I agree, as it is generally a bad idea to argue economics with a Nobel prize winning economist but I wonder if Congress has the stomach for the kind of massive deficit spending that such programs require. Infrastructure building, while yielding all kinds of longer term benefits, is really, really expensive. After blowing hundreds of billions on the financial sector, this may be a tough sell.