The of a presidential inauguration is usually one for expressions of optimism, but President-elect George W. Bush takes office this morning with a majority of Americans sharing his stated fear that the US is on the verge of a recession.
This is a view naturally played down by outgoing President Clinton, who in his final address to the nation on Thursday evening spoke only of the economic good times his administration had helped create.
"Our economy is breaking records with more than 22 million new jobs, the lowest unemployment rate in 30 years and the highest home ownership ever," he said, warning that Mr Bush should not veer away from fiscal responsibility.
But throughout the transition the economic news has been consistently gloomy, and yesterday was no exception. Stocks slipped back early on Wall Street with the publication of yet another report showing the US economy slowing.
According to the University of Michigan Index, which measures the readiness of American shoppers to spend money, US consumer sentiment slumped for the second month in a row.
The preliminary January index slid to 93.6 from 98.4 in December, a level that had not been seen since October 1998 when Russia devalued its currency and sent shock waves through the global economy.
Mr Bush also begins his presidency with a full-blown crisis in California over rolling power blackouts and the looming bankruptcy of the state's big electricity suppliers. If the lights cannot be kept on in California the effects could spread throughout the economy.
"I can't emphasise [enough] how important it is for this nation to develop energy supplies," said Mr Bush after hearings to confirm his Energy Secretary, Mr Spenser Abraham, the official landed with the toughest task in the first days of the new administration.
While most Americans are "confident or somewhat confident" that the new Republican President will handle the economy well, 51 per cent fear a recession is around the corner, according to a Reuters/Zogby poll released on the eve of Mr Bush's inauguration. Only 39 per cent thought the current prosperity would continue, and 10 per cent were unsure.
One in four people expect to be poorer in the next four years, including 31 per cent of women, 45 per cent of African-Americans, and one in three of lower income groups, though 56 per cent said they expected to become richer.
"I think this shows a significant turnaround in the optimism we have experienced in other polls recently," said pollster John Zogby. "This suggests to me that Bush has a challenge."
There were mixed signals in new market reports filed yesterday. eBay Inc shares rose as much as 17 per cent after the world's largest Internet auctioneer said fourth-quarter profit surged sixfold and sales rose by a more-than-forecast 81 per cent.
However, Home Depot, the world's largest home-improvement retailer and one of the 30 companies on the Dow Jones Industrial Average, joined a lengthening list of old-economy US companies hit by weak prices. Blaming a "declining economy" it warned that its fourth-quarter earnings would fall short of expectations on flat sales.
The new administration may receive a boost on January 31st if as expected the Federal Reserve chairman, Mr Alan Greenspan, cuts interest rates for the second time in a month.
Mr Greenspan, whose partnership with Mr Clinton gave the US eight years of unprecedented prosperity, will appear before the Senate next week to speak about the economy.
His testimony will determine whether optimism or pessimism will define the early days of the Bush administration.