So this is how it’s going to be… the markets start the year off with steep losses. Many analysts predict we’ll see a 10% correction (or more) before the market regroups, and we’re well on the way. Obviously a lot of factors influence the market action, and it’s not simply “jobs data” or the recession bogeyman. Even oil at $100 a barrel was a fluke by someone out to grab a piece of history. Of course we may see oil at $100 again, but its effect on the economy is not as large as some may think. It does however show how there’s a host of traders and specialists sitting on the edge of their seats waiting for news- mostly negative news. And you know what? It seems like Emerson’s quote: “Be careful what you set your heart upon, for you will surely have it.”
I’m not saying that a bunch of investment professionals really want the market to crash per se… but I think a whole bunch of folks wouldn’t mind a little clarity. If we’re going to have a recession… then let’s have it and be done with it. If the market’s going to correct, then let’s get going. And if the credit markets are all screwed up, then… well, uh… Oh. Maybe we just don’t know if all the bad news is out there, and that’s part of the problem. Once we identify problems, our nature is to fix them. So far there has been little progress in identifying and “fixing” anything regarding the credit and subprime mess. The market indeed hates uncertainty, so that’s the biggest issue even in the face of challenging real estate markets across the nation.
By the way, Briefing.com has written an excellent Market Outlook for 2008 with a clear-minded view of the issues the economy faces. It’s a cautious view overall, but I appreciate the pragmatic approach taken by Dick Green in weighing the challenges ahead.
My view is much the same- I think it just takes time. With time, we’re going to get tired of the negative news… it’s going to fade and change will happen. And a whole bunch of people and companies are going to look for ways to make more money than they’re making right now. Best of all, this is an election year! A few of the presidential hopefuls are going to make a real impact on the hearts and minds of Americans. And that’s not a bad thing… a little hope and idealism goes a long way. Huckabee and Obama? Sounds like a pretty good race to me.
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