I think the last months have made me careful of expectations.
I agree with those who say we are in new territory.
That said, it could be depression, or at the least the worst recession in my lifetime.
Why?
At every turn pundits have tried to impose limits on this crisis. First it would be confined to the housing market...and perhaps even be confined to certain housing markets like southern CA. Now we see chaos in parts of the third world that were thought to be sources of high growth. Look at the currency flows over the past couple of days. We have grown numb to earth shattering announcements. The Wall Street Investment banks are simply gone. Unbelieveable. Lehman bankrupt. Morgan and Goldman no longer investment banks. Bear gone, Merrill gone, Citigroup down 70% on the year forecast to show a net loss in 09.
I'm afraid I wouldn't use the term holiday spending.
Folks I talk to simply aren't spending period...not just gift shopping.
Of late you can get a 500 point swing at the drop of a hat. We see solid performance and forward momentum unable to move individual stocks up.
The way the market is moving on the story (or rumor) du jour, what will happen in mid-january when over a two week report period there is a parade of numbers--not rumors -- numbers, all bad and forcasts for 1H09 that are no better?
As I said, I don't want to be in the market over that announcement period. If I miss the bottom; I miss the bottom.
Of course just one man's view.
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