The Problem/The Sky is Falling/The bailout

In 2008 it became apparent to many that shadow financial institutions had become over leveraged by placing bets on mortgages (credit default swaps).

• Our unaudited Fed engineers a deal to save mortgage giant Bear Sterns and it merges with JP Morgan. No one knows what $ the Fed promised to make this happen. JPM later gets big chunk of TARP funds. Other smaller mergers happen.
• Lehman Brothers goes Bankrupt in Sept. 2008. Lehman claims lots of assets, but by the time they fell apart they had $613 billion in Debt and could only raise $1 billion in cash.
• Lehman debt spreads throughout the world, people realize how over leveraged all the other shadow financials must be, housing prices plummet, and stocks begin to fall. SPX goes from 1500 to 666.
• Treasury proposes TARP. Treasury/US government (the only entity in the world with power to stop fall) proposes to buy up bad debt and sell it later.. Paulson/Treasury later changes this to loaning shadow financials money $700 billion. ($50 billion or less has not yet been repaid)
• Stocks keep falling and QE1 introduced. Fed prints and dumps a trillion plus more dollars into economy. Finally stocks stabilize and start to move up There’s more but lets take a look at what happens if these actions do not take place

What If Absolutely Nothing Was Done?

You lived through the panic after the Lehman collapse. Now add this – What if the second largest mortgage company Bear Sterns collapsed on top of that? Add perhaps 3 time larger insurance giant AIG collapsing. It’s debt all owned to other shadow financials who themselves were up to their eyeballs in over leveraged debt. They too collapse like Lehman.

• The weekend before TARP, a run on AIG had started across the world. AIG who insured the shadow banks goes down then one bank collapsing after another because their collateral is no longer solvent. People panic and media adds to the frenzy. Everyone realizes. Lehman was just the tip of a giant iceberg of debt.
• Belly up goes AIG, BAC, Citi, Major European banks, GE, Fannie and  hundreds/thousands other major/minor financial institutions. No one knows which bank has how much debt, so people take their $ out of all banks. Fear grows hyped by the media.
• Stock market goes far lower than SPX 666
• Bonds of these banks collapse. Even with just Lehman’s collapse BAC bonds went from 100 to 82 before recovering. (An institution I am treasurer for owned these bonds)
• Financials, Fannie & Freddie bonds were the backbone of many money market funds (Think Fidelity, Vanguard etc) They or their insurance agent go belly up as the bonds become more worthless. You may have received a negative return on your money market fund depending on how are the panic had spread.
• Home prices plummet way way way way down.
• Not knowing which banks are shadow banks panicked investors pull their money from all banks. You know how suseptable your fellow Americans are to fear and fear mongering. Worldwide run on banking results. – a financial armageddon.

So a worldwide financial meltdown was averted.

That’s the good news now for the bad.

• How deep is the shadow financial hole? Fed engineered Mergers, TARP, QE1 now QE2, POMC and an UNAUDITED Fed who can had loans money at their discount window and/or use some other opaque means to fill the over leveraged gap of the opaque shadow financials.
• All of this cash used to fix the problem creates imbalances in the economic system that magnify the trillions gone into filing the shadow bank hole. Beyond my understanding, but nobel prize economists like Joe Stiglets and others get it.
• By 2008 we had already created a huge debt by going to war, cutting taxes, pork spending etc. So this new debt was built on more debt.

The UGLY

• There is no regulated financial derivatives exchange.
• We did not return to the old laws that prevented over leveraging in the past or end too big to fail. Congress passed are weaker measures.
• Dopamine When you get high the dopamine centers of your brain are activated. You get addicted to this pleasurable feeling. Sometimes like running its a heathy addiction. But with drugs or greed you keep needing bigger doses to obtain the same high. Physiologically those that run the shadow banks are not going to change their ways unless there is enforcement.

I left out stuff and will be back to Obama’s negatives next week

Mantra - “Not making any specific move until dollar breaks out of its range. I would look at a breakout higher for the dollar, and a corresponding fall in stocks and the MO to oversold as a buying opportunity for long term investors.” Looks like next Wednesday Fed meeting is the big event.

Look for Paul R’s always enlightening remarks on stocks and sectors in the comments section of the blog. See POSITION section of blog for lists of potential stocks & ETF’s including ”YOUR Stock List.”

The Hive – Goldman Sachs brand new billion dollar building

Goldman Sachs Fallout

From movie Casablanca – Captain Renault to Rick:” I’m shocked, shocked to find that gambling is going on in here!”

Perhaps Alan Greenspan’s Shocked disbelief in front of congress was real in 2008 – Greenspan ” I made a mistake” in believing free markets could regulate themselves without government oversight.

Investors411 readers understand that market manipulation - GREED – exists and it is unfortunately its human nature that if you cut the amount of regulators and regulations, greed can run wild.  A hypothetical and real examples.

• Cut penalties for theft, eliminate guards and surveillance cameras, leave chunks of money laying around the bank and what happens?
• Cut regulation, call for smaller government with less regulators in the Energy market = Enron
• Cut regulations, regulators of SEC and Justice Department = Bernie Madoff
• Cut  regulation in banking and you get “repro trades” driving the collapse of Lehman Brothers and Greek current debt crisis Lehman’s collapse (almost 1/2 trillion dollar loss) was the breaking point of the 2008 financial meltdown.
• Now Goldman Sach‘s has also been accused of “Fraud” leading up to the 2008 meltdown.

Best analysis – “Goldman Sachs Too Big to Obey the Law” – comes from MIT’s Simon Johnson. Also, decent article on legal ramifications in NYT for both SEC and Goldman

Bottom Line - In this case, Goldman Sachs is Goliath and the SEC is  David. GS has a dream team of legal experts that would make OJ Simpson, and the SEC look like little leaguers. GS face a danger of others piling on. We all face a danger of a run on the bank that is too big to fail.

Best Line you can tell your right wing friends who will argue that the left will over regulate everything from Credit Default Swaps to Shadow Banks -” I just want the regulation to be like they were under Ronald Reagan or was he a socialist too.”

Post Script – Bill Clinton has also admitted he was given the “wrong advise“ on derivatives (by Summers, Greenspan and Rubin) It’s time a lot of other politicians admit this error too.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

US markets took a major hit in increased HUGE volume on the news that the SEC had launched a case against mega bank Goldman Sachs.  Quote/paraphrase this AM on CNBC from SEC – “The Agency [SEC] is not done yet.” translation – there are more prosecutions to come involving the time period before the 2008 meltdown.

The best analysis I could find on what will drive markets this week. Interesting in this analysis they put the Greek debt crisis ahead of Goldman Sachs. (I wouldn’t) It also ignores the economic impact that the Iceland volcano is having on European economy.

Fearless Forecasts Last Week - “Up week” 3 of 4 major indexes were higher, despite Goldman Sach’s news.

Fearless Forecast This Week – We should have better than expected  earnings, but ash clouds over Europe, Goldman Sachs, European/Greece crisis will probably overshadow earnings – “Down Week.”

Significant Indexes

• McClellan Oscillator fell dramatically to -29.37 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still in NEUTRAL territory – but we are approaching oversold territory – A time to buy.
• US Dollar – rose +0.39% yesterday. [Anything over +/- @0.50 is significant.] Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up. The 50 day moving average is a major support/resistance level. Right now the dollar is just above the 50 day MA.  Think of a huge battle going on over the last 4 trading days as to wether the dollar goes up or down,

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

TYH position has been completely closed – O% gain. UWM will be probably sold for what looks to be a 7% loss today.

When the McClellan Index gets below 60 Invetors411 will again add to positions.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Head of Lehman Brothers Dick Fuld

Friends and Enemies?

What countries do your fellow citizens look at favorably and unfavorably? Gallop Poll has some fascinating results with Canada on top and Iran on the bottom. In black and white, over the top terms – who are out top 3 friends and top 3 enemies? Interesting - 90% is the largest rating up or down.

D’s blog comment

As always check out the comments on right hand side of blog by Popeye, PaulR, D, & Doggie’s Mom on Israel and stocks. One comment is something I think or hope we all share by D -

I’m so sick of those who are blinded by their emotions and stereotype one side as all evil and the other as all good.

Seeking Alpha

Three of you last week sent me editorials/articles from this financial site.  THANKS Reality is money makes the world go around – or at least influences everything from politics to religion. One particular man to follow is Jeff Nielson – read The Plutarch nation about the huge and growing division between rich and poor in the USA – How great the tax cuts are for t he wealthy and how small they are for the Middle class.

Lehman Brothers

Turns out that Lehman Brothers was lying about how much money they had and their accountants (Ernst and Young) backed them up according to a 2200 page report. Lehman’s collapse set off the 2008 meltdown. Seeking Alpha currently has 3 stories on this, but this  Dylan Ratigan video best explains how “the crooks” scammed the world through “repo transaction ” One of the Greatest crimes in history.”

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Flat day in weak volume. Volume has NOT confirmed the move higher over the last few weeks. Cutting this section short to answer YOUR QUESTIONS

• What exactly is going elliptical? I really wish there were a clear set of exact rules to follow. Basically, its when a stocks moves too high too fast in big volume – it runs out of buyers and collapses because there is no one left to buy. This can also happen with sellers and going down too fast. This can happen interday (for day traders to use), but most of you are longer term traders than that.  Look at the charts of 3 stocks that have just gone elliptical. IMAX, C & CNAM (the later went elliptical @ a week ago. Common characteristic three or four days of a 20+% move higher in HUGE volume. Usually the bigger the climb & volume the worse the drop afterward. First off going elliptical is almost always a time to sell.  The harder question is when to jump back in. (tomorrow)
• Are TYH and other ETF’s that do 2 and 3 times what a market basket of stock do dangerous to hold overnight? See PaulR’s always astute market comments on the right side of blog. Short answer is YES. If you look at the “candlestick” chart of TYH over the last 6 months you will find several times is opened @3+%lower and one time in late November it opened @5% lower. This puts it in the same category  as “high beta” (hot stocks) stocks like Citigroup. Citi’s chart shows a  few more days it fell over 3+% and one time in December plunged @7% overnight. There is a big risk in both.
• Solution – First learn more about the technical aspect of investing. Second you can mitigate the risk by buying less.  Say you think technology is going to go up so you buy QQQQ (basically a tech ETF that mirrors tech.) THY does roughly 3X what QQQQ does. Therefore, Invest 1/3 the money in TYH that you would have in the QQQQ. It’s then almost the exact same risk in total money and you have 2/3 of your capital earning interest or for another investment. This is called leverage. And as many of you know there are a zillion other ways to mitigate risk through leverage. Some good (like this if you don’t go & over leverage your whole portfolio) and some that can get you and the world in a whole lot of trouble.

Significant Indexes

• McClellan Oscillator fell a again to +51.09 yesterday. We are still under +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. Two weeks ago week the NYMO reached a high of 75.33. Interesting fact here NYMO is falling as stocks slowly melt up.  This is probably due to the fact that this Oscillator takes into account volume that is declining.
• BDI - The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks. After flattening for a few days it is again starting to explode higher = Bulls rule
• USD – The Dollar 0 Friday the dollar -0.58% and broke through a support level.  In the past there has been a strong correlation between a falling dollar and a rising US stock market. = Bullish sign
  

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Over the last few days several of you have sent emails with many interesting new stocks RINO, CTRP & explosive CNAM are three I’ll add to tomorrow’s watch list.

From Friday “Shorter term traders – ” Bought a 10% (Of portfolio) position in TYH at 151.50. Put stop at that 151.5 and may sell 1/2 for 3 to 5% gain hopefully today. TYH closed at 154.99 – Sold 1/2 TYH at 156,oo for +3% gain Friday AM

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

“You Lie Boy”

Remember back in Oct. of 2002 when over 100,000 protesters gathered in Washington to protest the Iraq war. Even the supposedly left leaning Washington Post buried the story in its metro section. The paper’s ombudsman later lamented, “a couple of ho-hum photographs that captured the protest’s fringe elements.”

The Same WaPo puts on the front page Sunday, an anti government protest organized by the right wings favorite cable channel (Laughably called FOX news ) of “60,000 to 70,000 almost exclusively WHITE pro corporate interest protesters . The WaPo is only the tip of the corporate mainstream media that has focused on screaming protesters depicting opponents as Nazi’s or socialists rather than on the substance of heath care. LINK

This is no surprise when you consider Pew Research’s statistic that “the politics and the protests of health care, accounted for a staggering 62 percent of all cable news coverage” for one week in mid August.  LINK

Your comments recently have captured this inequity and American’s media focus on the disruptive lunatic fringe elements as a way to hide any legitimate discussion of the issues.

• From  a personal email – Other significant health care issues not discussed LINK to article
  
• From Doggie’s Mom – “Let’s get back on track” LINK
• From Bob Sadinsky – “the race card… Of the 47 million without coverage, I am sure that mainstream thought is that they are either Slackers, Black or Latino or Illegals. So why should my money go to cover them and worse yet,why should my coverage suffer so these “people” can be covered. LINK
• From NYT’s Maureen Dowd – “You lie boy” LINK
• From Think Progress A Sunday protestor (Fox media fan) on why Obama will opress white America video LINK

More and more its looking like the mainstream media is bias is promoting, but hiding an ugly racial divide that is growing in America.

Anniversary of Meltdown

On the eve of the collapse of Lehman Brothers and the near collapse of financial institutions throughout the world, President Obama has a major address today.

Sherwehe , who has sent in some other very enlightening emails refers to an article in Vanity Fair entitled “Good Billions after Bad ” LINK to article

The lack of regulations to the “free market” got us is into the worldwide recession. Even Alan Greenspan admitted this. But as good as Obama’s speeches are his administration sure looks like a paper tiger when it comes to doing something. So far no real corrections have been made. Printed $ and tax payer funds have been given to shadow institutions throughout the world. OK, financial markets are recovering, but while their stocks have sizzled reform has fizzled.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals and Fundamentals

Technically Friday’s slight loss in falling, below average volume , is just what bulls like to see.

Fearless Forecast for last week – ” is for a down week” – Except for Friday markets rallied – Therefore, prediction correct

Fearless forecast for this week – Down early, as dollar stabilizes and fears of regulation (see below/above). But, rallies are getting bought into. So prediction is for another positive week.

The second long term risk – Protectionism – If the BDI breaks down further is means huge cargo ships are sitting empty and protectionism is growing throughout the world.

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Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern . The BDI has leveled off and started to rise over the last few weeks. BDI fell a minor -22 Friday. BDI trading at 2468 and has recently formed a resistance level at 2388. Would not trust any rally, especially in foreign exporting countries if the BDI breaks down below this number.

Each day this looks more like a base has been formed above a key support level Longer flat bottoms and slowly moving higher is usually indication of, at least, a short term bottom-Bullish short term outlook for BDI and we have certainly recovered from the devastating lows of Dec./Jan.

The BDI is 41% off its high (early June) Before that it gained almost +170% from early April to Jun e

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$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar. The multi year chart gives you a much better picture of  where we seem to be headed (down) and the next major resistance level. An orderly/slow fall in the dollar is good for the majority of S%P companies that make most of their $ abroad. Dramatic longer term falls indicate loss of confidence in America.

One big reason Investors411 is currently  focusing more on US equities (XLF & SPX ) is because of the drop in the dollar making foreign exports more expensive in the US and US exports less expensive abroad. However, On the whole an orderly/slow drop of the dollar helps US markets and a case can be made that it helps worldwide recovery.

The dollar has fallen 5 days in a row.  It fell less, but still dropped -0.17% yesterday. Dollar trading at $76.68 Short term Bullish for most stocks

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

Last year’s low was around $71, so there is a long way to go before the next major support level.

Positions

The whole Positions Section has been revised (Click on “Positions” at top of blog). Check it out

This is a dollar dropping rally. Don’t get a sugar high from it.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

Iran Day 11

Iranian protestors – Photo from Andrw Sullivan blog

Neda Agha-Soltan has become the hero of the Iranian revolution from American media (LA Times here ) to Arab media here In fact al Jazeera has a whole section devoted to "Iran in Crisis" here Al Jazeera is an outlet for mostly Arab Sunni’s and Iran is Persian Shia’s. No love lost between these two groups. You heard and saw Neda’s story at Investors 411 3 days ago.

More of the same in Iran. Less on street demonstrators and more violence. Previously listed best  sources are still telling the story to the world. Some predictions from BBC – What’s next for Iran here

One issue that many on the far left are not going to like to hear. Israe l has certainly made mistakes in its two recent wars with Iran and her proxies (Hamas & Hezbollah). But seeing how the Iran’s "Supreme Leader" treats his own people you can see how hard it is to make some peace with him or his clients. Of course, the first the recognize and lavishly praise Ahmadinejad’s & "Supreme Leader’s" victory was Hamas (here) and Hezbollah (here )

Barack "Hoover" Obama?

Yesterday Abby posted an article by Kevin Baker on Obama from Harper’s magazine. Unfortunately you have to be a subscriber to reference the article. You can view some excerpts here The focus is that Obama has not and may not be able to change the strong intrenched interest that created the economic mess we are now in. President Hoover (his picture above) did nothing and the Great Depression grew.

Context We tore down the regulations on "free" markets and developed a massive credit debt over the last decade that has exploded. Yes, Paulson, Bernanke (more the previous Fed chair Greenspan) and Bush were leaders in creating this mess, but late last year when we stood on the edge of economic catastrophe they (PB & B) instituted a plan and prevented world economies from falling off a cliff. Bernanke, Geithner & Obama have followed through and added to that plan

Remember Lehman Brothers cause over $400+ billion dollars of debt to spread throughout the world when it went bankrupt. People were lined up in panic at insurance companies and banks. What if AIG, CitiBank, Merrill Lynch Fannie, Freddie. AIG and so many others had followed Lehman. The end result would have rippled through out the system and economic catastrophe would have been the result.

How Obama handles the economy is priority #1. Because it is the world’s economy and he is easily the most important/influencial figure. Unlike Hoover whose inaction significantly added to the Great Depression Obama has acted. But its those entrench interests that have dug in. Time will tell.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

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Technicals & Fundamentals

US markets took a major hit on a bad economic forecast from the World Bank.

The volume was again below average. It hard to be sure about making a forecast when our #1 forecasting tool – volume – gives no indication of which way prices will flow.

Major event – Fed Meets today and issues statement on Wednesday

Yesterday’s major event was The World’s Bank lowered its outlook for the world’s economy this year from -1.7% to -2.9% .  This is some truly bad new s for long term investors.

Since volume is out as a forecasting tool right now, today’s price move will act as a confirmation of yesterday’s move. Do we fall further (bearish) or rebound (bullish)?

Significant forecasting tools/Indexes for stock markets

Note - Repeated statements in brown

Right now, there are two indexes that are significantly influencing stocks in the USA & world. The US dollar in the short term and the BDI in the longer term

$USD -  The dollar is the index to watch. Dollar went up +0.57% yesterday. Any move over 0.50 is significant.  It looks like the dollar may be establishing a short term bullish pattern (see chart)  of higher highs and higher lows. Still to early to tell.

All together now -  our mantra – when the dollar goes up stocks go down . This strong inverse correlation has existed for many moons.

BDI - The Baltic Dry Index measures the flow of goods (world trade). 24 up days in a row, 6 down day in a row,  a 6 day rally and the BDI fell minimally on Friday and significantly yesterday. This is a very important chart that has just rolled over. It usually moves in one direction for an extended period of time.  If it moves past and creates a lower low than it had eight days ago it would be a serious sign of trouble Right now, the momentum is with the bears.

If trade is diminishing through out the world then a worldwide recovery is in big trouble.

You can play with the chart and create different settings to get a better idea of what’s happening, (the same with all other links to different charts)

Reading the Tea Leaves

Still think this market has moved too high to fast and is a technical rebound. As stated two weeks ago we may see a 5 to 10% technical fall or consolidation. This week fearless forecast – Another down to flat week. The benchmark S%P 500 has already broken through support and fallen 6 to 7% from its high to  893. Next significant support level is 875 to 880. As stated above volume is NOT confirming (or has yet to confirm) the downside move. So far this still is a technical correction of a market that went too high too fast.

Both the dollar and the BDI have started to trend in the wrong direction (If you’re a bull on stocks) Add the World’s Bank prediction and you have lots of reason to hear the bear’s growl.

Got burned with this the last time I did this, but buying a little protection on any minor rally. Adding small position in SDS (ETF that does 2X the opposite of the S&P 500)

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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Behavioral Economics 

 Making money in the markets is all about realizing what the stampeding bulls and bears are going to do before they do. Yesterday, the fact that we had to bail out AIG again was not “built into the market.”  The bears, in this case, said “Again, more money for AIG“  and groweled. They did not realize how bad the situation really was and all stocks suffered in a bear stampede. “Again” was not built into investors considerations.

Investors411 has brought you the news from across the pond that the Bank of Scotland has transparently admitted to $722 billion in troubled assets (see yesterday’s blog). We invented credit default swaps and other insurance scams in our deregulated unsupervised supposed “free markets” It’s perfectly reasonable to assume that the bulls and bears don’t yet realize just how large the losses are for any institution that traded these toxic assets. 

As investors wake up to the fact that the hidden losses of almost every company trading toxic debt are bigger than they imagined, stocks are falling. Bank of America, Citigroup, Wells Fargo and at least dozen other major and many minor institution are probably just as bad off as Bank of Scotland.

So far we’ve given AIG $180 billion and the Bank of England has backed over $400 billion in “troubled assets” or toxic debt (see yesterday’s blog) for the Bank of Scotland.  The investing bulls and bears do not seem to get it. There’s a lot more bailouts to come.

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Why All Stocks Suffer 

If the banking system collapses or continues to implode loans do not get made. If loans stop so does most commerce. So everything from mom and pop companies to a outperforming tech giant like IBM suffers.

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Why All Countries Suffer

Lehman Brothers collapsed and its debt rippled throughout the financial institutions across the world. Countries like Iceland and Latvia are in meltdown politically and economically in part from the Lehman collapse and in part from using the same insurance scams Lehman used.

A whole mess of developing countries bought into this supposed “free market” system.  Cut taxes, cut the regulators, cut government, cut enforcement, cut rules and just let wealthy capitalist do whatever they want.  The system will regulate itself. Baloney! Simply put they stole your money, your future and your kids future. Now those countries who fell for this baloney are living a nightmare.  Almost all of their market have collapsed far more than the 55% drop in the USA.  Remember The Great Depression led toWorld War 2.

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On The Right Recovery Track?

If we learn from history and stop believing in the people who dug us into this economic nightmare we will be on the right track. Yes, Obama has crafted an economic plan that moves us forward. But unfortunately is may not yet be bold/big enough to dig us out and its going to need at least a couple of years to get off the ground. Why? –  Because the economic hole we dug is so very very deep.