Predicting a recession is a fools game, but its safe to say that the sick economy was run over in September and is now, as everyone warned, bleeding profusely.
But the hemorrhaging of jobs and wages is always the last (and most painful) domino to fall in the recession line. And it may signal we are gathering steam toward the bottom.
On another front, long-term interest rates may be starting to fall. And with the Fed set to lower the prime rate yet again (and if on January 20th the Democrats can start opening up loans to prevent foreclosures), we may finally be about to put a salve on the biggest wound in our economy: the housing market. And by the indications of the success of Cyber Monday, consumer spending may be holding up its bit even despite the Great Depression.
It's too bad we didn't start applying this salve in March of 2008, when Hillary Clinton first suggested it. That might have lessened the pain of this crisis.
Now, it looks like we're going to have to wait until February 2009, at the earliest, till we start to get some relief.
That will still take a few months to work its way through the system.
So by all indications, things are going to get worse - likely in a slow, seeping fashion - till May of 2009. Being a lagging indicator, then, the job market is likely to stay bad well into 2010.
But you'd better put your money back into stocks well before then.
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