Now, America’s CEOs are getting involved. This evening, President Obama will meet with a group of top bosses at the White House to discuss the fiscal cliff and other economic issues. Among those attending: Pepsi CEO Indra Nooyi and GE CEO Jeff Immelt. To the extent corporate America got involved in the 2012 election, it was generally on the side of Mitt Romney. Lobbying organizations like the Chamber of Commerce funded huge anti-Obama advertising campaigns, while lots of CEOs contributed to anti-Obama Super PACs.

In effect, CEOs, especially Wall Street CEOs, went all in on a Romney victory. But as pragmatists, they have come around rather quickly. Many CEOs are genuinely freaked out at the prospect of the fiscal cliff. “At a Wall Street Journal CEO conference in Washington, 73 percent of participants said their primary concern was the so-called fiscal cliff,” the Journal reported Wednesday. But the bosses seem to be more worried about the impact of a slowdown on their companies’ bottom lines than on their own. An informal show of hands at the conference showed many of the CEOs were personally willing to pay higher taxes to reduce the deficit. In the precincts of the rich, there is rising acceptance that their personal tax rates will be higher next year.

Goldman Sachs CEO Lloyd Blankfein took to the op-ed page of The Wall Street Journal to offer an olive branch of sorts. Expressing concern that the fiscal cliff would “derail the fragile recovery,” he urged Congress to act. He accepted the premise that revenues must be part of the deal. “A number of CEOs and companies agree and support principles that call for a comprehensive and balanced solution to the debt problem—increased tax revenues and decreased spending,” he wrote. Blankfein also seemed to accept that tax rates on personal income would have to go up. “Broadening the personal income-tax base by closing loopholes will generate substantial additional revenue while minimizing increases in marginal tax rates [my italics] that could stifle risk-taking and robust growth.” Notice the small but important change here: increases in tax rates on personal income should be minimized, not ruled out. In other words, Blankfein’s position is quite closely aligned with Geithner’s.

Now, Blankfein doesn’t speak for the Republican Party any more than Robert Rubin speaks for the Democrats. But to have the CEO of one of America’s most powerful investment banks publicly make the case that it is OK for marginal tax rates to rise is significant. It’s amazing the difference a week makes.

At 8:30 a.m., the Bureau of Labor Statistics released what was likely the single most consequential economic data point in recent political history: the September employment report. BLS reported that the companies added 114,000 payroll jobs in the month. The unemployment rate, calculated from a separate survey in which BLS asks individuals about their employment situation, ticked down from 8.1 percent in August to 7.8 percent in September.

The report was important: psychologically, economically, and politically. Most savvy pundits thought Ohio would be President Obama’s firewall. But it was really the uemployment data that turned out to be his impregnable fortress.

It was the first time the unemployment rate had fallen below 8 percent since January 2009. But flows are more important than levels, and more easily understood. Or to put it another way, it’s not so much where things are that matter, but the direction they’re going. Since hitting its lows in 2009, the economy had been fitfully—and then steadily—improving. Between March 2009 and the fall of 2012, the stock markets had essentially doubled. In October, the economy was in its 39th straight month of growth. Even the housing market was coming around. And incumbents tend to get rewarded for improvement.

The labor market, however, remained a big question mark. The economy continued to shed jobs into early 2010. And in many months, job growth was painfully slow. That was electoral poison for Barack Obama.

Wind is a big business in Iowa. According to the Iowa Wind Energy Association, the state is the third largest for wind production, with 4,536 megawatts of capacity. Texas and California are first and second. When it comes to the percentage of electricity generated by wind, Iowa is far and away the leader in the U.S., with 20 percent. "As more of our new wind farms come online, I wouldn't be surprised to see it reach 25 percent in the next 6 months," said Harold Prior, executive director of the Iowa Wind Energy Association.

Putting up wind turbines creates a lot of good collateral economic activity. Wind turbines are very large and heavy, and hence difficult to ship over long distances. So areas that erect a lot of wind turbines tend to attract manufacturers and suppliers. The state's 2,800 turbines have brought hundreds of manufacturers and suppliers to Iowa, from which they export to other states and countries. The construction of wind farms is leading other investors to plow cash into constructing electricity distribution and transmission lines. Several thousand Iowa jobs rely on wind power. And each year, landowners collect more than $14 million in payments in exchange for allowing turbines to stand on their property.

Of course, the industry is only viable thanks to the 20-year-old production tax credit, which gives the owners of turbines a tax refund for every electron of electricity they generate in the turbines' first ten years of operation. But the Federal Renewable Electricity Production Tax Credit is in danger of sunsetting at the end of this year. As such, it is another one of the victims of the bizarre politicization of alternative energy.

George H.W. Bush signed the first production tax credit into law in 1992. In 2008, George W. Bush rhapsodized about the possibilities of solar.  "I really see a day in which each house can be a little electric generator of their own and feeding back excess power into the gird through the use of solar power," he said. But since the election of President Obama, Congressional Republicans have generally opposed efforts to back alternative energy. In part it's because there was a lot of green energy stuff in the stimulus, which virtually every Republican opposed. In part it's because a lot of big GOP donors are in the oil and coal industry, which rightly view renewable energy as a threat. And in part it's because  some alternative energy programs involved making large loan and investments in individual companies like Solyndra. To nobody's surprise, despite intense lobbying from the large companies involved, the Senate and the House have not agreed to extend the production tax credit.

We’ve learned, however, that the just-in-time economy is subject to disruptions by forces of nature. Last year, Japan’s tsunami quickly led to shortages at Honda and Toyota dealerships in the U.S. And we’re seeing it with Sandy today. Because of its size and location, Sandy inflicted maximum damage on the just-in-time economy. It took out 19th-century infrastructure (ports, rail), 20th-century infrastructure (tunnels, highways, airports), and 21st-century infrastructure (cellphone and Internet service). “The New York area’s port system is the largest on the East Coast, and the third largest in the nation. Last year, it handled $208 billion in cargo,” as Stephanie Clifford and Nelson Schwartz reported in The New York Times on Monday. And that is causing significant disruptions. “The supply chain is backing up at a crucial time, just as retailers normally bring their final shipments into stores for the holiday shopping season, which retailers depend on for annual profitability.”

The just-in-time mentality has spread from manufacturing and retailing into other businesses, and into our personal lives. And the logic is both compelling and unavoidable. We don’t power our homes by running coal-burning stoves and storing electricity in immense batteries; we bring in power produced by distant coal-burning plants over wires. Gas-station owners take delivery of gasoline every other day. Why? Doing so lets them conserve cash and maintain flexibility in pricing. What’s more, maintaining bigger supplies would require the construction of expensive, unsightly, and environmentally problematic storage tanks. We don’t arrive at a train station an hour before the train leaves; we arrive just before it does. We don’t can and pickle vegetables, or store meat in the chest freezer we had when I was a kid; we have it delivered just-in-time from Freshdirect.com or Peapod. We don’t walk down to the boutique; we order from Rue La La.

In fact, e-commerce is a massive and growing just-in-time industry. See something you want, click and buy it, and wait for the UPS truck. According to the Census Bureau (PDF), electronic and online sales are up 11.5 percent this year, more than twice the rate at which the overall retail market is growing. Such just-in-time commerce accounts for about 9 percent of retail sales. And it’s growing. Just wait until Amazon.com rolls out same-day delivery. Meanwhile, we’re now turning data into a just-in-time business. Why go to the expense and inconvenience of storing and managing your own information, when it can reside in the cloud—and be served to you where you want it at any time.

It’s all to the good. But once a link in the chain is broken—or when several links are broken at once—outages, delays, and shortages ensue. And that causes massive economic inefficiency.

And of course, after disruptive episodes, events like the marathon can provide a much-needed return to normalcy. Thousands of people around the world have spent a lot of time and money to train and travel for the race. Many are running for reasons that have nothing to do with personal bests and everything to do with survival—celebrating a triumph over cancer, or running in memory of loved one, or raising money for charity. For the bars and restaurants that line the route, the marathon means big business, adding up to $350 million of economic activity.

But the marathon involves a certain amount of conspicuous consumption of basics—fresh fruit, water, gasoline, and electricity—all of which are in short supply in New York and the surrounding region. Staten Island is a remarkably inauspicious place to start. In the hours before the race, thousands of people arrive in New York’’s least populous borough and shed disposable clothes, jam themselves full to bursting with Gatorade and water, and then leave behind a huge mess. This year, it will all take place with people on Staten Island lacking water and electricity, with many residents suddenly homeless, and with volunteers and professionals retrieving drowned bodies.

It takes a lot of human power and energy to run those 26.2 miles. But it also requires a lot of power and energy to run the race: to fuel the cars and rescue vehicles, to power the sound systems and run the communications networks. In ordinary times, nobody would begrudge the use of fuel and mobile-generating capacity for the marathon. But these aren’’t ordinary times. Hundreds of thousands of people within a stone’’s throw of the race route lack power. The New York Post noted that the mobile generators used for the marathon could power 400 homes on Staten Island. Meanwhile, the U.S. military is airlifting generating equipment to the East Coast. The disparity between the spare-no-resource attitude of the marathon and the slow-motion restoration of electricity in the New York region is noticeable.

On employment, Friday’s jobs report will be the big tell. But the preliminary data released Thursday points in the right direction. ADP, the payroll-processing company that reports its own monthly jobs figure, said the private sector added 158,000 jobs in October. Not spectacular, but pretty good. Also on Thursday, the Labor Department said first-time unemployment claims fell to 363,000 last week, down from 372,000 the previous week. Yes, there’s still an unemployment crisis. But here’s the reality: the labor market is probably in better shape today than at any time since late 2007.

The same might be said for housing. As we’ve been noting for months, housing is back. This past year has brought persistently higher levels of new and existing home sales, and, finally, of home values. On Tuesday, Case-Shiller reported that home values rose in August, and are up 2.0 percent from August 2011. On Thursday, the Census Bureau reported that construction spending(PDF) turned in a healthy showing in September—rising 0.6 percent from August and up 7.8 percent from September 2011. The gains were driven entirely by housing. Spending on private residential construction in September 2012 was up an impressive 20.9 percent from September 2011, and total private construction spending was up 14.4 percent from September 2011. And what I’ve dubbed the “conservative recovery” persists. Thanks to continuing austerity measures, public spending on construction fell 0.8 percent in September from August, and was off 4.2 percent from September 2011.

Good news in housing tends to be good news for other parts of the economy: for the labor market, since housing is a labor-intensive business; for manufacturing, since a lot of materials used in housing are made domestically; and even for the car companies, which tend to sell a lot of high-margin pickup trucks when the housing market expands. And here, again, Thursday brought positive news on these sectors. The ISM reported that its purchasing managers index for manufacturing in October was 51.7, a bit higher than September. Any reading above 50 indicates the sector is expanding. This is the 31st straight month of expansion.

The auto industry is both the largest manufacturing sector of the U.S. and the largest retail sector. As go cars, so goes the economy. And so far this year, the auto industry has been gaining speed. On Thursday morning, the car companies began to report U.S. sales for October.

The timing seemed propitious for Thompson, too. Yes, the Times Company’s stock has been in decline for a long time. And, like every other print entity, the paper has had difficulty making a profitable transition to a digital world. But the business seems to be stabilizing, thanks in part to a lot of tough decisions made by the company’s much-maligned executive leadership.

To cope with declining advertising revenue, the Times installed a controversial paywall. In Thursday’s earnings report, the company reported that total revenue fell marginally—ad dollars were down nearly 9 percent from the year-ago quarter—but circulation revenues rose 7.4 percent. Why? “Paid subscribers to The New York Times and the International Herald Tribune digital subscription packages, e-readers, and replica editions totaled approximately 566,000 as of the end of the third quarter, an increase of approximately 57,000 or 11 percent since the end of the second quarter of 2012.”

In January 2009, the company, desperate for cash, borrowed $250 million from Mexican industrialist Carlos Slim Helu at a sky-high 14 percent interest rate. But after years of heavy cost cuts and  cash-preserving measures like cutting the dividend, it managed to retire the debt it owed to Slim in July 2011. Meanwhile, the Times has been holding a garage sale of sorts:  in late 2011, it sold off its collection of regional newspapers for $150 million. Last month, it sold About Group for $300 million to IAC, parent company of The Daily Beast. Earlier this month, it received $167 million for its share of Indeed.com, a jobs search engine, which was sold.

But here’s the irony. As Thompson prepares to assume the position of CEO—his first day is supposed to be Nov. 12—he’s facing two significant issues that will bear directly on his ability to lead the organization: a scandal over journalistic ethics in London, and a long-running, increasingly bitter labor dispute in New York.

Here’s what happened. On Tuesday, IAC’s stock closed at $52.46. In the morning, IAC released its third-quarter earnings, which were generally better than analysts had expected. In trading before the stock market formally opened, shares rose. At 10:30 a.m., IAC submitted the required filing to the Securities and Exchange Commission. This filing contained additional information about expected 2013 results for specific units, including the “Media” unit and a unit labeled “Other.” The filing included some complicated accounting language but basically said those two units were expected to report a loss for 2013. After opening higher than its Tuesday close, the stock began to drift downward. Again, nothing abnormal.

At 11 a.m. IAC started a conference call during which executives discussed the results with analysts and investors. (You can check out the call here. Then, at 11:28, StreetAccount, a unit of financial-data provider FactSet, incorrectly entered data suggesting that IAC had reported that it expected the whole company would report an operating loss in 2013—not just the “Media” and “Other” units.

Within seconds, as the chart shows, the stock began to plunge. Of course, markets are supposed to process new information that might affect a stock price. And some investors may have dumped the shares based on FactSet’s new piece of information, which turned out to be incorrect. But it’s also highly likely that electronic traders picked up on the action in the stock, thus triggering their own sales—which in turn triggered more trading systems to hit sell. And so a decline quickly became a rout. The stock, which stood at about $50.50 at about 11 a.m., plunged to $45.57 by 11:34—a decline of nearly 10 percent. At 11:34, NASDAQ, the exchange on which IAC is traded, halted trading in IAC’s stock—that’s what it does every time a particular stock falls rapidly in such a short period of time.

Informed of the activity, IAC’s management told investors on the conference call, which was still happening, that incorrect information had been disseminated. Trading resumed at 11:39 a.m., and by noon, the stock had regained much of the ground it gained in its mini-crash. The stock closed the day at about $48. By the middle of the day on Thursday, IAC’s stock had rallied back to almost precisely where it was before the mini-crash.

“I get the sense there is a wave building,” says Gene Ruth, an analyst at the Gartner Group. When his clients discuss cloud computing, he says, the question has shifted from “why would you do that?” to “why aren’t you doing that?”

But outsourcing has its limits. And these two trends also set the stage for high-profile, concentrated failures. Every day, in homes, businesses, large companies, and networks, there are calamities—outages, computers freezing, systems that are pokey and difficult to access. But it happens behind closed doors. The cloud centralized and publicizes such failure.

Staten, the Forrester analyst, notes that outages like Tuesday’s are “are par for the course, not just in the cloud, but in traditional hosting and corporate data centers.” It was only shocking because “we are making the dumb assumption that the cloud is more highly available than any other data center.”

What happens when demand rises on a relative basis while supplies fall on a relative basis? Why, prices go up. The median price of a new home sold in September 2012 was $242,400, up 10.3 percent from $217,000 in September 2011.

But a few years later, the shoe is increasingly on the other foot. American Consumers may not be partying like its 2006, but things have been moving steadily in the right direction. The job market is improving, with more than 4 million jobs added since early 2010. Consumer confidence, as measured by the University of Michigan, is at a five-year high. Financial failure is down across the board, as consumers are generally doing a better job keeping up with financial obligations. And as regular readers of this space should know by now, housing is back. Sales, construction activity, and prices are all higher through the first nine months of 2012 than they were in the first nine months of 2011. So it’s no surprise that retail sales continue to rise and that the National Retail Federation expects holiday sales to rise a healthy 4.6 percent in 2012. (Amazon.com’s stock was up on Tuesday.)

As for global business, that’s another story. The giant companies with operations around the globe that are now finding their dependence on overseas markets for growth is problematic. Even though the worst of the sovereign debt crisis seems to have passed, the euro zone—the wealthiest single entity outside the U.S.—is in recession and doesn’t have much prospect of growth. China, the motor of the world’s economy, is showing signs of slowing down. In the third quarter, China grew at a 7.4 percent annual rate—the lowest such number it has posted since early 2009. India is shifting into a lower gear. Simply put, the volume of goods, services, and people whizzing around the globe is still rising—but at a slower rate than previously thought. The IMF in September reduced its estimate for trade growth in 2012 from 3.7 percent to a mere 2.5 percent. (In 2011, global trade grew 5 percent.)

And so the news from large corporations has been generally dispiriting for the last few months. IHS iSuppli earlier this month reported that global PC shipments are expected to fall in 2012 for the first time since 2001. That’s bad news for companies like Intel, Microsoft, Hewlett-Packard, and Dell. Equipment maker Caterpillar on Monday reported a solid quarter(PDF) but dialed down expectations for 2012 revenues and profits due to “global economic conditions that are weaker than we had previously expected.” Chemical giant DuPont on Tuesday morning reported disappointing earnings.

All of which means the U.S. domestic economy is now doing better on a relative and absolute basis than many of its global peers and rivals. UPS’s earnings report was one of the reasons the stock market fell early Tuesday. But look closely inside the company’s earnings. It shows the dichotomy. The company’s U.S. business revenues rose a bit from the year-ago quarter, and average daily volumes rose nearly 4 percent. In international operations, by contrast, revenues fell nearly 4 percent and daily volumes were flat.

Excel Bank, a four-branch bank based in Sedalia, Missouri, with $200 million in assets, failed, and was taken over by Simmons First National Bank, based in Pine Bluff, Arkansas.

This brings the total to 46 banks failing through the first 42 weeks of 2012. But that’s still progress. As the chart shows, bank failures rose sharply in the wake of the housing bust: 30 in 2008, 140 in 2009, and 157 in 2010. (The FDIC's complete failed bank list can be seen here.)

But the wave of failures has subsided. Bailouts, government guarantees, and the Fed's easy money policies helped buoy banks. Meanwhile, American companies, borrowers, and consumers started to do a much better job keeping up with financial obligations. This is one of the great underreported and underdiscussed features of the current economic expansion. In 2011, 93 banks failed. That's high by historic standards, but it was down 40 percent from 2010. And the size of the banks failing fell, too. All of which meant the systemic implications of bank failures became far less severe in 2011 than they were in 2010.

That trend is continuing through 2012. As noted, through the first 42 weeks of 2012, 46 banks have failed – more than one per week. But in the first 42 weeks of 2011, 86 banks failed. So far through 2012, then, bank failures are down 46 percent from 2011.

In late 2007 the bank decided that what it needed was a numbers guy—a quant. And it found one in Vikram Pandit, a Columbia finance Ph.D. turned hedge-fund manager. Pandit took his slide rule to the bank’s balance sheet—accepting a massive federal bailout, cutting jobs, hiving off unwanted assets into a separate unit, and rebuilding the firm’s capital base and reputation from the ground up. The focus on hard data bore fruit. Citigroup repaid the government, sold off junky assets, and reduced spending (it even cut back the company’s name to just plain Citi). But Pandit wasn’t versed in basic CEO-ship. He couldn’t convince the Federal Reserve to sign off on its new capital plan, or convince shareholders to approve his pay package—two major embarrassments.

As 2012 wore on, observers noted that Citi lacked a leader versed in basic blocking and tackling. So naturally it turned to a former college-football lineman. Michael Corbat, who played at Harvard, is a lifelong Citi banker. He has spent 30 years getting to know the ins and outs of the company. Citi is now betting the lineman can transform into a quarterback.

First, and above all, there’s the job market. Most Americans shop with their earnings. Even with wages relatively stagnant, when more people work, it tends to translate into more consumer spending. In September 2012, there were 1.8 million more Americans with payroll jobs than there were in September 2011; and 4.2 million more than there were in February 2010.

Second, there’s consumer confidence. The labor market isn’t good by any stretch of the imagination. But consumer sentiment and psychology plays a role in spending decisions. If people are feeling better about their current situation and future prospects, they’ll be more likely to spend a chunk of their paycheck—and more willing to take on a little debt in order to go to the mall. And consumer confidence is definitely on the rise. The Conference Board’s most recent reading of consumer confidence shows it spiked in September and stands at its highest level since February 2012. Last Friday, the University of Michigan’s measure of consumer sentiment came in at a five-year high.

Consumer confidence rises and falls with the job market, which is on the upswing. But it also rises and falls with the value of assets held by the American consumer. A booming stock market tends to make the minority of Americans who own stocks feel wealthier, and hence more confident about spending. And a rising housing market tends to make the majority of Americans who own homes feel wealthier, and hence more confident about spending. (Check out this article by my colleague Matthew Zeitlin to understand precisely how that works.) Data from Case-Shiller suggests that for the first time in years, home prices began rising in the U.S. this summer on a year-over-year basis.

One by one, over the past two years, the gears that make the mighty consumer engine go have been engaged. And the data points to an ironic twist in the trajectory of the U.S. economy. Businesses, which thrived and boomed in the early years of this subpar economy, are now increasingly taking a backseat to increasingly upbeat consumers.

That trend is continuing through 2012. Through the first 41 weeks of 2012, 43 banks have failed. That's still (duh!) a pace of about one per week. But, again, it is down sharply from 2011. In the first 41 weeks of 2011, 80 banks failed. So far through 2012, then, bank failures are down 46 percent from 2011. And in the past 11 weeks, only four banks have failed.

That's good new for owners of banks, for depositors who tend to get stressed out when their bank fails, and for the FDIC deposit insurance fund, which continues to replenish itself. It's also good news for the economy at large.