Be afraid. Be very afraid... (Updated)

…when Treasury Secretary Tim Geithner says there is nothing to be afraid of. NPR’s Michelle Norris interviewed him recently and questioned him about two things: 1) the prospects of a “double dip” or a second recessionary downturn, and 2) whether it’s really a good idea to be urging banks to be lending aggressively given the recent problems with bad loans and defaults.

Geithner says everything is wonderful: "We are not going to have a second wave of financial crisis." And when Norris asks, "So it's ok for [banks] to take risks right now?" Geithner responds, "Absolutely." Norris is understandably skeptical about all of this. Mike Shedlock obviously doesn’t buy it: "The arrogance and ignorance of Geithner are both appalling."

Be ready folks: 2010—to paraphrase Bette Davis/”Margo”—is going to be a “bumpy” year (and don’t be surprised by a major swoon on Wall Street). I hope to be posting more about this soon.

(Here's an earlier related post: Double Dip.)

Update: In an interview with ABC News today, Paul Krugman expressed his belief there is a "reasonably high chance" the economy will contract again in 2010. "I'm really worried about the second half [of the year]."