Or perhaps it is. One of the most successful Federal Reserve governors of all time, Paul Volcker stepped up to air his views recently on the severity of the U.S. recession. The octogenarian, born the year before the 1929 crash, suggested to a commencement ceremony at Brooklyn Law School earlier this week that this would likely prove to be the worst recession since the Second World War and may prove to be the deepest.

Mr. Volcker served as chairman of the Federal Reserve between 1979 and 1987 and those of you with long memories might recall that he's the guy responsible for the deep recession having determined that the U.S. economy didn't need inflation. His policy of strangling price pressures out of the economy saw interest rates rise to 19% in 1981 lifting the so-called misery index to somewhere around 30% - for the uninitiated, the misery index combines the rates of inflation and unemployment. His success together with eth policies of the Reagan era laid the groundwork for prosperity after the economy regained its footing in the mid-1980s.

The observations of the former chairman are in stark contrast to the optimism expressed by investors quaffing on rising equity prices around the globe. He senses that economic recovery is likely to remain many years away even with "truly massive fiscal and monetary stimulus [is] at work."

These days Mr. Volcker is head of President Obama's Economic Recovery Advisory Board. Typical of any conservative citizen of his age he decries indebtedness and sounds truly concerned about the fact that the nation has for the longest time been spending beyond its means. When he says, "an unimaginable budget deficit as far as one can see," we think Mr. Volcker means to say that the budget deficit won't be solved at least in his lifetime.

Possibly very true. Treasury secretary, Timothy Geithner is in the middle of a rather important series of addresses to Chinese leaders and a variety of congregations on the mainland. His job is to convince the Chinese people that the vast amount of debts issued by Washington is appropriate and manageable. We haven't heard him say it yet, but the alternative of not doing anything or simply doing too little would not be a pretty site. Whether the Chinese come around to accepting Mr. Geithner's explanation and whether they take him as a man of his word remains to be seen. 

But at the least, both Volcker and Geithner are reading from the same hymn book as they tell their audiences that the level of debt is not acceptable and must be reduced. We're not at all sure what line they are supposed to take when yields are rising to a point where they might hinder recession. Mr. Volcker notes that "foreign countries have been for a long while willing to finance our excess spending, but that process can't continue forever." While for his part the treasury secretary told the Chinese that he expects to reduce the budget deficit to a more manageable 3% of GDP rather than closer to a 12% reading by the end of 2010. 

Because the Chinese government has allocated close to $800 billion to purchasing liquid U.S. treasuries over the years, they have a vested interest in a stable debt market and a strong dollar. For now, the threats to both are causing frayed nerves. In the pipeline according to the views of Mr. Volcker are sweeping reforms and changes to banking, markets and regulatory institutions. 

Between the pair of them, President Obama must be hoping to high heaven that the words of his top two lieutenants will be enough to prevent any liquidation by Chinese or any other central bank or wealth fund. Only time will tell.