The D-word is duly deployed, sending an icy chill down your humble correspondent’s back. The problem with trying to take this seriously is that Team Barry (and, in Specter’s case, his allies) has been so shameless and cynical in using the downturn as an “opportunity” that there’s no way to distinguish earnest warnings from exploitative fearmongering. E.g., is Specter on the level here or is he trumping up the extent of the crisis to justify his stimulus vote after the fact as a necessary heresy that saved the world?

Being a congenital pessimist, I swallow hard and assume that the end is indeed nigh.

“Our economic problems are enormously serious — more serious than is publicly disclosed. And I think we’re on the brink of a depression,” he told reporters at the state Capitol…

He reiterated Monday that he felt passage of the legislation was more important than protecting his Senate seat.

“Had there been no stimulus, I think we’d have gone right off the edge,” he said. “I think we’re pretty close to the edge anyway, to be very brutally blunt about it.”

A friend who lives in Manhattan told me the other day that no one she knows is behaving as though we’re on the verge of falling off a cliff. I’m not behaving that way myself, frankly: I don’t have many luxury expenses but I still order out as much as I used to, still keep up my gym membership, etc. Exit question: What would have to happen for the mood in the country to change to a depression footing? I think we’d need an event rather than the death by inches we see on the market every day to really drive it home. If Citi failed or GM went into bankruptcy and the Dow suddenly dropped 1,000 points, that might do it. Or, I guess, if the Dow went low enough — approaching 5,000, maybe? — then real panic would set in. Short of that, I think people (at least here in NYC) are going to keep treating it like Y2K and hope for the best.

Update: Repent.

America’s five largest banks, which already have received $145 billion in taxpayer bailout dollars, still face potentially catastrophic losses from exotic investments if economic conditions substantially worsen, their latest financial reports show.

Citibank, Bank of America, HSBC Bank USA, Wells Fargo Bank and J.P. Morgan Chase reported that their “current” net loss risks from derivatives — insurance-like bets tied to a loan or other underlying asset — surged to $587 billion as of Dec. 31. Buried in end-of-the-year regulatory reports that McClatchy has reviewed, the figures reflect a jump of 49 percent in just 90 days.

Update (Ed): Here’s an indicator as to whether Specter is serious or whether he’s just playing CYA on Porkulus.  How many earmarks does he have in the omnibus spending bill?  Because from where I sit, Congress has given us 9,283 reasons to think they’re blowing smoke.  When they start sacrificing, then I’ll buy it.