Economic recovery begins to take form

— -- Many economists say the "Great Recession" is over.

Now what?

Despite the severity of the downturn and recent encouraging reports on manufacturing and housing, most experts predict a tepid recovery and lingering high unemployment.

What would such a rebound look like? Sluggish consumer spending that acts like a giant speed bump, moderate rebounds in housing and manufacturing, and relatively robust corporate earnings that drive increased business spending, economists say.

Here's how these economic spark plugs are expected to perform in the months ahead:

Consumer spending.

It makes up about 70% of the economy, and the American shopper traditionally has led the nation out of recession. Not this time, most experts say. Consumers have lost about $13 trillion in wealth in the housing and stock market swoons. They're trying to recoup some of that by socking away any extra cash. The savings rate hit 5.2% in the second quarter vs. a low of 1% before the crisis. And don't forget tight-fisted lenders, the fall-off in home equity loans amid plunging real estate values, and a high jobless rate that makes even working Americans nervous about their future.

"People are beginning to realize you can't live beyond your means forever," says Standard & Poor's chief economist David Wyss.

Sure, consumer spending ticked up a modest 0.2% in July, and that trend will likely continue through August or even September. But that's largely because of the government's cash-for-clunkers program and it will mean fewer car sales in later months, Wyss says.

After falling about 1% this year, consumer spending should edge up 2% in 2010 and 2.25% in 2011, says Wells Fargo chief economist John Silvia. That compares with 6.5% annual growth following a steep recession in the early 1980s.

Housing.

The housing market has shown signs of life lately. Existing home sales rose 7.2% in July from a year earlier to a two-year high. And prices rose in June in 18 of 20 cities tracked by the Standard & Poor's Case-Shiller home price index, up from eight in May. But much of that has been driven by an $8,000 tax credit for first-time home buyers that's set to expire Nov. 30, Wyss says.