Believe it or not, there are plenty of reasons to hope 2010 will see things start to pick up. But just to be safe, we're keeping an eye open for trouble. We've had enough surprises.

Good: The economy lost only 11,000 jobs in November, far better than expected and the smallest monthly loss since the recession began in December 2007. Economists expect to see monthly job growth starting some time in the first quarter.

Bad: The previous recession ended in November 2001, followed by a prolonged "jobless recovery." Job growth finally resumed in September 2003; the economy added 8.3 million jobs by the time employment peaked in December 2007.

It then took just two years for the economy to shred 7.2 million jobs. Employment today is back where it was in early 2000, even as the U.S. population has grown 9.5% over the past decade. Six of the 10 biggest monthly job losses since World War II occurred in this recession. It could easily take four years for employment to return to its 2007 level -- assuming the economy keeps growing. More challenges: Many old-economy jobs -- Detroit's automakers; newspapers -- aren't coming back. Many of the jobs created in the last up cycle, and lost in the recession, were tied to the real-estate and financial-markets bubble.

Good: The jobless rate dipped to 10.0% in November after hitting 10.2% in October, its highest point since 1983. Economists say the unemployment rate could rise a bit before the job market begins a slow recovery in the first quarter. But it now seems likely that we won't break the post-World War II unemployment record (10.8%) set in 1982.

Bad: It will surely take years for the unemployment rate to fall to its December 2007 level (4.9%). In the 1980s, it took seven years for the unemployment rate to drop from its peak (10.8%) to its business-cycle low (5.0%).

Good: The economy in the third quarter grew at an annual rate of 2.8%, a strong indicator that the recession ended sometime that quarter. Gross domestic product will come in at -2.4% for full-year 2009 and grow 2.6% in 2010 and 3.0% in 2011, according to Bloomberg's survey of economists. That's not far from GDP's average growth for 2002-2007 (2.6%).

Bad: That still suggests a tepid recovery, making it harder to bring back lost jobs. Near-term growth is likely to be below the 1950-2000 GDP average of 3.6%.

Good: Housing sales have surged in recent months, with prices rising and inventories shrinking. The National Association of Realtors said existing home sales in October reached their highest seasonally adjusted annual rate since February 2007. The trade group's index of pending sales has risen for nine consecutive months.

The Standard & Poor's Case-Shiller U.S. National Home Price Index rose in the second and third quarters. Inventories of existing homes for sale have fallen. Inventories of new homes for sale are at their lowest level since 1971; builders soon may need to step up construction. Government tax credits on home purchases and near-record-low mortgages (30-year fixed-rate loans are below 5%) give buyers good incentives to jump in.

Bad: More homeowners are falling behind on mortgages, and foreclosures are on the rise. One in seven mortgages was in foreclosure, or at least one payment behind, at the end of the third quarter, according to the Mortgage Bankers Association. That's a record high.

Jay Brinkmann, the mortgage group's chief economist, said in a statement: "Despite the recession ending in mid-summer, the decline in mortgage performance continues. Job losses continue to increase and drive up delinquencies and foreclosures because mortgages are paid with paychecks, not percentage-point increases in GDP. ... The outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve."

Good: Consumer confidence over the past year has rebounded from its depressed November 2008 level, when the Reuters/University of Michigan index of consumer sentiment plunged to 55.3 (on a scale of 100) amid the global financial meltdown. That was the index's lowest point since it fell to an all-time low (51.7) in 1980.

Bad: The index's preliminary December 2009 level (73.4) rose from November but still remains comparatively weak in historic terms. That's no surprise given the double-digit unemployment rate; consumers aren't exactly confident about the current situation or near-term prospects. It's hard to see how consumers will buy this economy out of deep recession when they remain so skittish.

Good: U.S. ad spending will drop 2.6% in 2010, according to a forecast from Publicis Groupe's ZenithOptimedia. That's good news? Yes, compared to a stunning 12.9% plunge in 2009 and 4.2% decline in 2008. ZenithOptimedia expects spending to turn northward in 2011 (up a tepid 1.6%) and 2012 (up 2.9%).

The media agency forecasts worldwide ad spending to resume growth in 2010 (up a scant 0.9%) after tumbling 10.2% in 2009. It foresees worldwide growth of 3.9% in 2011 and 4.8% in 2012.

Bad: 2009 saw the biggest U.S. ad spending decline since the Great Depression. Next year could mark the third year of decline -- also unprecedented since the Depression. Even if growth resumes after that, ZenithOptimedia's estimates suggest U.S. media spending in 2012 will still be below the level of 2000.

Good: More U.S. banks have failed in 2009 -- 130 as of early December -- than in the entire 15-year period of 1993-2007. This year's tally far surpasses the 25 banks that closed in 2008, when the global crisis in financial markets reached its pinnacle.

The number of failures may seem numbing, yet this year will likely end up ranking only eighth in bank failures since the opening of the Federal Deposit Insurance Corp. in 1934. The years 1986 through 1992 each saw more failures, largely reflecting the collapse of savings and loans. (Worst year: 1989, when 531 institutions failed.)

Most of this year's failures were comparatively small banks readily absorbed by healthier institutions. Average assets of this year's busted banks: $1.1 billion.

The epidemic of bank failures isn't over. But the worst of the crisis is behind us. Major banks have raised new capital and are repaying last year's Troubled Asset Relief Program bailout cash.

Bad: Six of the 10 largest bank failures in U.S. history occurred in 2008 and 2009. (The other four members of that esteemed group went bust in the late '80s and early '90s.)

The nation's biggest bank bust occurred in September 2008 with the failure of Washington Mutual. The Seattle bank, with assets of $307 billion, was ten times the size of the No. 2 failure (IndyMac, which collapsed in July 2008).

The bad news has a good side: Failed WaMu reopened the next morning under a financially sound new owner (JPMorgan Chase; see the Book of Tens deals list). Even at the nadir of fall 2008's financial meltdown, the FDIC and the banking system were able to manage a massive failure without incident.

Good: What's up with the stock market? Pure bull. The Dow Jones Industrial Average has moved north of 10,000, soaring 59% since hitting its bear-market low last March.

Among the Ad Age/Bloomberg AdMarket 50, all media and agency stocks have seen year-to-date gains, and 19 of 26 marketer stocks have posted gains for the year. Biggest winner: Coupon and direct-marketing firm Valassis Communications, whose stock this year has rocketed 1,100%. Valassis shares in January traded at $1.10, little more than the value of a Sunday newspaper coupon. The stock now trades north of $16.

Bad: The market has only recovered half of its bear-market losses. The Dow is up 3,700 points from a March 2009 nadir. But it's still 3,900 points below the all-time high (14,198) reached in October 2007. It's an open question whether and why the stock market will keep surging given prospects for a lackluster economic recovery.

Good: It turns out prices don't always go up. The Consumer Price Index is expected to fall 0.4% in 2009, according to Bloomberg's survey of economists. That would mark the first year of deflation since 1955 and only the second deflationary year since the Great Depression. (The other year was 1949.)

Deflation poses a problem if it causes consumers to hold off buying on the belief that prices will be lower down the road. That was a major issue in the early '30s, which saw four years of deflation -- including a 9% price drop in 1931 and 10% in 1932.

Deflation in 2009 was modest, hardly enough to upend consumer buying. Consumers may not have noticed significant price drops; the core inflation rate, which factors out price changes in the volatile categories of food and energy, was expected to rise 1.5% in 2009.

Economists expect the Consumer Price Index to increase a modest 2.0% in 2010 and 2.2% in 2011, according to Bloomberg's survey.

Bad: The government borrowed heavily to pay for bailouts and economic stimulus schemes. That could put upward pressure on interest rates and inflation in future years.

The inflation rate since 1983 has been below 5% every year except one (5.4% in 1990). But it's worth recalling the double-digit inflation of 1974 (President Ford's "Whip Inflation Now") and early '80s (13.5% in 1980, when presidential candidate Ronald Reagan asked voters, "Are you better off than you were four years ago?").

Inflation may be down, but it's not out.

Good: All indications are the longest recession since the Depression is now history. (The National Bureau of Economic Research, arbiter of business-cycle dates, probably will make the pronouncement in the next year.) The average business-cycle expansion since the end of World War II has lasted nearly five years, which would suggest the next recession won't occur until 2014.

Bad: There is the potential for a double dip. Ronald Reagan trounced Jimmy Carter amid the 1980 downturn on the optimistic promise of change, but the economy soon slumped back into a recession that lasted until nearly the end of 1982.