prudentinvestor

Things Aren't as Bad as They Seem - Barron's

Good to see some optimism. I agree, the sky will not fall and all will be well in several years.

However, I still suspect a long recession to rebalance the misallocations of capital and labor brought about by a policy, sustained for over a decade, that diverted excessive resources towards the housing and finance sectors; at the expense of other sectors, especially the manufacturing sector.

There is bound to be a painful transition as the economy rebalances, and this will involve destruction of many of the current business models and profit-making patterns, with consequent losses in the stock market. Thus, I doubt that stocks have bottomed yet, except perhaps for a short period.