It may take awhile to convince car buyers, but General Motors has emerged from bankruptcy with better prospects for a profitable future than virtually any of the automaker's critics predicted a few months ago. Here's why:

When times are tough, one thing that tends to raise the spirits is knowing that somebody else has it worse. And as wretched as the U.S. economy seems, it's not as bad as in other regions.

The International Monetary Fund's latest tally of world economic conditions forecasts a 2.6 decline in U.S. economic output for all of 2009, and anemic growth of 0.8 percent in 2010. That's more optimistic than the IMF's prediction from three months ago, but those are still lousy numbers. A weak economy throughout 2010 would mean a bleak employment picture, an agonizingly slow housing recovery, and another year or two likely to feel like a recession, whether it's technically labeled that or not.

[See what Obama must do before Stimulus II.]

Imagine President Obama addressing the nation on prime-time television and saying, "The government has done enough to bail out the economy. You're all on your own now."

He very well could. The total federal commitment to fiscal stimulus, corporate rescues, homeowner relief, and various other bailouts is nearly $10 trillion (that's $10,000,000,000,000) over who knows how many years. You'd think that might be enough. But the economy is still lousy, unemployment is soaring, and Vice President Joe Biden now says the Obamanauts "misread how bad the economy was" when planning their recovery package earlier this year.

Biden wasn't just flapping his restless mouth. By issuing a quasi mea culpa on the economy, he was starting an official discussion about another round of stimulus spending, which would actually be the third in this recession. (Remember George Bush's $150 billion worth of tax rebates in 2008?) It's obvious that the economy still needs help, and it's the government's job, more or less, to aid its citizens. But there's one kind of stimulus that Obama and virtually every other politician have completely avoided so far: a plea for greater self-reliance.

[See how to tell when a real recovery begins.]

Last summer, when the prospect of a General Motors bankruptcy started to materialize, CEO Rick Wagoner was insistent: A Chapter 11 filing would be ruinous.

He was wrong, but not by a lot. GM and Chrysler are both still in business following unprecedented bankruptcy filings—but only thanks to billions in federal aid and government guarantees backing their products. And the two automakers will look quite different in their new incarnations. At GM, Wagoner is gone. His replacement, Fritz Henderson, has cut half of GM's eight divisions, leaving Chevrolet, Cadillac, Buick, and GMC. Chrysler is now owned by Italian automaker Fiat and desperately awaiting fresh technology and new models needed to become competitive. Many current Chrysler models may simply disappear.

[Slideshow: Cars Hurt Most By the Recession.]

Those are the biggest headlines, but the rest of the auto industry is reeling as well. Overall sales are down about 35 percent from last year, which itself was a bust, thanks to $4 gas and an incipient recession. Toyota, the world's biggest automaker, lost nearly $5 billion last year and might fare no better this year. Other bankruptcies may be on the horizon, with conglomerates in China and India prowling for bargains and Western know-how amid the wreckage. While some familiar brands could vanish, new ones may soon arrive in U.S. dealerships. Warren Buffett, for instance, believes a Chinese firm called BYD is one of the world's most promising electric-car companies—and has invested about $230 million in it.

[See which cars are getting a boost from the recession.]

America might be in a recession, but the auto industry is in a depression.

Car sales so far this year are down 35 percent compared with 2008, and that was a bad year, too, on account of $4 gas and the start of the Great Recession. Auto sales in the United States peaked at nearly 17 million in 2006, and automakers used to consider 14 million in annual sales a bad year. In 2009, automakers will be lucky to sell 10 million vehicles.

[Slideshow: Cars Getting a Boost From the Recession.]

Some of the victims, like recovering bankrupts General Motors and Chrysler, are well known. But stalwart Toyota is struggling, too, along with its youth-oriented Scion division. Niche brands like Saab and Volvo have lost traction. Nissan's Infiniti luxury division is down.

It wasn't part of the stimulus package, but President Obama's financial reform could turn out to rank among Washington's biggest job-creation programs.

One contributing factor in the financial meltdown has been a patchwork regulatory system with wide gaps exploited by companies like AIG, Countrywide Financial, and many of Wall Street's biggest firms. Hardly anybody thinks the system is too small. In fact, it's a sprawling regulatory regime with at least eight federal agencies, plus bank, insurance, and securities regulators in most of the 50 states and industry groups set up to police their own members. In terms of bureaucracy, oversight of the financial system rivals that of Big Pharma, the auto industry, and other heavily regulated parts of the economy.

[See who stands to win under Obama's reforms.]

Everybody knows that American shoppers have cut back their spending, driving some retailers—and even some malls—out of business. But commerce hasn't ground to a complete halt, and Americans are still spending on some things. Somewhere.

[Slideshow: America's Most Profitable Malls]

Using data from Green Street Advisors, an investment research firm in Newport Beach, Calif., that specializes in publicly owned real estate companies, U.S. News identified malls in which the retail economy is relatively healthy. While bargain shopping is obviously popular, the nation's most profitable shopping centers generally don't rely on discounters. Instead, they tend to feature chains with a strong brand identity, like Nordstrom, Abercrombie & Fitch, Apple, and Anthropologie. Since it's all about real estate, location is vital: The best malls tend to be in densely populated areas or tourist hotspots. And it sure helps if local residents are affluent.

[See America's most endangered malls.]

Birmingham's Century Plaza mall was a consumer mecca when it opened in 1971, drawing shoppers from outlying suburbs and even from other states. Over the years, however, people moved outward from central Birmingham, and new shopping centers sprouted around them. Sales at Century Plaza declined. Three of the mall's four big "anchor" tenants eventually left, and smaller retailers followed. By 2008, Century Plaza was a shadowy hulk with more shuttered stores than open ones. Then the last anchor tenant, Sears, announced it was leaving. The mall finally closed for good in early June.

[Slideshow: America's Most Endangered Malls]

Malls have a natural lifespan, as population centers shift, architecture evolves, and shopping habits change. But a sharp recession is clearly accelerating the demise of vulnerable retailers—and some of the shopping centers they inhabit. Plunging sales are one obvious reason. Many retailers are also saddled with heavy debt taken on in recent years to fund aggressive growth. And the credit crunch has made cash scarce for firms that need it most.

Those tough conditions have already driven retailers like Circuit City, Linens 'N Things, and Steve & Barry's out of business. Other chains are closing stores and slashing costs as they fight to survive. General Growth Properties, a Chicago firm that operates more than 200 malls—and owns the remnants of Century Plaza—declared bankruptcy in April and is working on a restructuring plan.

It's a tumultuous time for retailers—and the malls they inhabit. With anxious consumers hoarding cash, several major retail chains have bitten the dust, and others may follow. Some malls are likely to go out of business as well. To gauge the damage, U.S. News asked Steve Sterrett, chief financial officer of Simon Property Group, the nation's biggest mall operator, about the retail economy, prospects for a recovery, and the signs of a troubled mall. Excerpts:

How has the recession directly affected your business?

At the end of the day, we own the real estate. As long as we own the best anchored real estate, we're a step away from the economic impact on the retailer.

[See America's most endangered malls | Slideshow ]

Our esteemed Congress seems determined to make rapacious bankers look good.

If extra schooling seems like a lot of effort, get used to it—the smarter you are, the more hours you're likely to work.

It's obvious that there's a big pay gap between people who have more education and people who have less: Doctors and engineers with advanced degrees earn a lot more than high-school grads working blue-collar jobs. It turns out there's also a growing "leisure gap" between more- and less-educated Americans: The more schooling, the less time devoted to leisure.

President Obama’s ambitious overhaul of the financial regulatory system would create a new layer of consumer protections, expand the Washington regulatory establishment and change the way America’s banks do business. The goal is to provide more stability to the financial system, which would benefit most Americans. But such abrupt change would also cause some casualties. Here’s who stands to lose under Obama’s reforms:

The man doesn’t think small. If President Barack Obama’s proposed overhaul of the financial regulatory system gets through Congress, it will be a virtual reboot of some of the most engrained government agencies. The plan would rearrange the duties of Federal Reserve, the Treausury Dept., and many other Washington fiefdoms. It would extend federal oversight to hedge funds and a whole new basket of financial products, and change the way Americans use mortgages and credit cards. Here’s who some of the biggest winners will be if the plan goes into effect:

It's a buyer's market for talent these days—and a few firms are actually hiring. But with so many applicants competing for so few jobs, it's more important than ever to differentiate yourself from everybody else in line. To figure out what companies want—and how they view applicants who have been laid off—I spoke with Bob Damon, president for North America at executive recruiter Korn/Ferry International. Excerpts:

Is there a stigma associated with getting laid off? Or does that include so many people that it's now considered a mainstream experience? I don't think there's a stigma associated with being let go, but it depends on the nature of why somebody ends up on the beach. If it's because of a merger of two companies, I think people understand that. You can see through a merger and tell that some good people end up out there. If a company goes Chapter 11, that's not necessarily a black mark on an executive, either. The individual manager doesn't necessarily bear responsibility for what happened to his company. And there's still a shortage of leadership across all companies.

[On the hunt for a new job? Use our new search tool to help you find the best place to work.]

You could conclude just about anything from the daily cavalcade of economic statistics. Some suggest an imminent recovery. Others seem to foretell years of gloom. The bent of the expert interpreting the latest news—bull, bear, Obama-basher, Wall Street-hater—has as much to do with the outlook as the numbers themselves.

For the foreseeable future, there will be an aggressive hunt for two economic recoveries. One is the technical improvement in economic indicators that signals the economy is growing again. That's the one economists care about, which is why they scour the numbers on retail sales, business inventories, purchasing manager sentiment, subatomic inflation, the mood in Shanghai, and anything else that could help pinpoint the exact inflection point for a turnaround.

The other recovery, the one that most consumers are waiting for, is the one in which companies stop firing and start hiring, banks return to normal lending, and families stop worrying about jobs and income. And that turnaround—the consumer recovery—is likely to take much longer to materialize than the technical recovery.

[See why you're going to save more, like it or not.]