Our economy is suffering because we are in a glut of supply. There is just simply too much stuff around to create a demand for new products. Somehow people get by, and the internet has a lot to do with that. Used goods are being rotated around more efficiently.
The real estate market, however is not being rotated well, because people and banks invested heavily into it at inflated prices, and are sitting on the properties trying to wait out the storm. Inflation will eventually give people the illusion that they are selling their properties at a minor loss or profit.