Phil Herbert, a New Brighton money manager, made trades for an hour Friday morning as stock markets zigzagged. He earned some money in gold, silver and hog futures for his Golden Harvest Partners fund, he said. Then he shut his machine down.

"Enough is enough," Herbert said. "This is getting crazy again."

Watching investment news on TV, Lynda Larson and her husband, Dave, discussed cashing out of stocks in his 401(k), but decided to stay the course. The market plunge Thursday was upsetting, said Larson, 70, of Inver Grove Heights.

"How long is it going to bounce around at the bottom before it crawls back up again?"

A grim week of sinking stocks and other sickly economic signs have left many Minnesotans newly worried and watchful -- and with an unsettling sense of déjà vu as they ask a question whose answer has the power to upend their lives: Is the country staring at the prospect of another recession?

Big global losses late last week in financial markets from New York to Sydney struck at a time when returns had been a bright spot for consumers amid sunken home prices, stagnant wages, and rising costs for food and fuel. Another unwelcome jolt hit Friday night when the U.S. credit rating was downgraded, a first that could lead to higher borrowing rates for businesses and households.

Economists disagree about the risk of a double-dip recession, but there are ominous signals the likelihood is growing.

For Mark Vitner, senior economist at Wells Fargo Securities, that prospect is being stoked by the lack of growth in the country's gross domestic product. Every time the inflation-adjusted GDP -- the total sum of the country's goods and services -- has slowed to less than 2 percent, the economy has either already fallen into a recession or been in one within a year. The country's GDP growth was recently revised down to just 0.4 percent in the first quarter and 1.3 percent in the second.

Vitner said he puts the odds of a recession at about one in three. "With growth this weak, we just have little margin for error," he said. "It leaves us more vulnerable."

In recent days, reports have shown both consumer spending and manufacturing activity softening. On Tuesday, the Commerce Department said that consumers, squeezed by high gas prices and the extended slide in home values, cut their spending by 0.2 percent in June, the first such drop in 20 months.

That news came a day after manufacturers, who generally have been a bright spot in the recovery, showed their weakest growth in two years, according to a monthly report from the Institute for Supply Management. Meanwhile, fear that Europe's debt crisis is engulfing Italy and Spain, two of its largest economies, rattled global markets.

Friday's jobs report -- one of the main signposts of the nation's economic health -- soothed markets when it showed the country's employers had added 117,000 jobs last month, more than expected. The unemployment rate ticked down a notch to 9.1 percent, but largely because nearly 200,000 people exited the labor force.

Some economists say the country is stuck in what they call a growth recession, expanding so slowly it doesn't pull down high unemployment.

"We're just going to continue bumping along at 1 to 2 percent growth," said Art Rolnick, a senior fellow at the University of Minnesota's Humphrey School of Public Affairs and formerly with the Federal Reserve Bank of Minneapolis. "There's isn't a whole lot that we're going to be able to do about it."

'Washington circus'

All eyes are now on the Federal Reserve, which meets again Tuesday, but short-term interest rates are already zero, and it's not clear what its next move might be.

Keith Tufte, chief investment officer for Minnetonka-based Adam Smith Advisors, said the debate over whether or not the country is heading back into recession may be moot. Consumers on Main Street behave as if the country's been in a recession all along, he said, paying off debts and adding to savings.

"If somebody's out of a job, they're not having a toast that we're officially not yet in a recession," Tufte said. "Investors are still sort of disgusted by the whole Washington circus we had over the last two months, and they just don't have a lot of confidence that the politicians ... or the Fed has the ability or the bullets left in their gun to save us this time."

Bleak troughs aren't inspiring, but they can be one of the best times to buy stock, Tufte said, noting that he added to his own personal portfolios Thursday and Friday.

Heading to Kip's Pub in Golden Valley for his investment club meeting Thursday night, Matt Dunn was eager to take advantage of Thursday's 512-point drop in the Dow Jones industrial average. Dunn and his buddies, most in their mid-30s, get together monthly to pitch different stocks to buy, when not trading stories about their children. This time, conversation quickly turned to the markets. Dunn, 35, of Maple Grove, said group members have the benefit of time on their side, with decades to go until retirement. Fear, not fundamentals, caused the panicky drop, he said, adding, "Companies are doing really well right now."

Strong corporate earnings were not enough to outweigh concerns last week.

Minnesota's 100 largest publicly traded companies, for instance, have lost a total of $53.8 billion in value in the past 10 trading days.

The Dow closed with a minor gain Friday, but it was down 5.8 percent for the week, its worst week, percentage-wise, since March 2009. The S&P 500 was down 7.2 percent for the week.

A volatile month

Ron Schuman, who retired from his job as a service manager for an air-conditioning manufacturer last year, said his financial adviser assures him he'll be OK. Still, Schuman, 67, of Champlin, said he couldn't help worrying about Thursday's plunge in the Dow Jones industrial average.

"It's one of those things that if it's not within your control, what can you do?" Schuman said. "What was I going to do? It already happened."

Schuman said he's doing some consulting work for his former employer, figuring every side job he gets means less money he needs to take from his 401(k).

August, some experts noted, is not a good month for markets.

"I hate August," said Chris Varvares, president of Macroeconomic Advisers in St. Louis, an economic analysis firm. "The bosses go away, they leave the kids on the trading desk. August just tends to be really volatile."

The Piper Jaffray trading floor in Minneapolis was busy Friday as the firm's institutional clients, many of them mutual funds, moved more of their investments into cash and tried to lower their risk, said Jim Fehrenbach, Piper's head of U.S. equity distribution.

They also were trading into larger-cap stocks, or stocks in safer sectors such as big energy companies, health care and profitable tech companies. It has all been fairly orderly, Fehrenbach said, compared with the panic of the crash in October 2008.

For him, the August wobbles aren't a big concern.

"I'm more scared of October, to tell you the truth."

Jennifer Bjorhus • 612-673-4683 • Kara McGuire • 612-673-7293 •