IF the market is like a pendulum, as it has been seen to resemble in the past

[Taverner]

That is, after every big 'boom' to the economy (Defense Boom, 80's Finance Boom, 90's Tech Boom, 00's Real Estate Boom, and the smaller boom-let from consumer spending) there is an equal reaction towards recession. Being that the pendulum never had the time to fully swing back, it just kept getting pulled in the opposite direction - the economy should hit bottom at some time.

However, our recession seems to be a slow one, one that, like the booms, doesn't happen all of a sudden, but gradually loses steam.

So, being this as the case - it resembles a lot of what J.M. Keynes spoke of - and so a solution would have to be a Keynesian one - e.g. New Deal Part Deux.

Am I getting this right?

[ThomWV]

1. No

[Taverner]

2. What am I getting wrong?

[ThomWV]

6. Its impossible to know where to start.

Your first paragraph makes no sense at all, but as close as I can come to deciphering it you seem to thank that if a crash isn't total because the next boom comes on to quickly then something - but what is not clear.

Next paragraph makes a sort of absurd statement that this recession is somehow slow. I don't know if you mean that it started a long time ago (apparently contradicted by recognition of recent booms in technology and real estate) or that it slipped up on us slowly, which also seems odd in as much as last November there was no hint of recession.

Finally your reference and comments on keynesian economics don't give great confidence that you've ever had a class in basic macro economics.

[Taverner]

7. Well, I would say the recession officially started in 2000

It started going the other way because of lax mortgage laws, but if we let it complete its course back in 2000-2001 who knows where we would be

As for the last line - I have had a course, and I've even read his work. I just am lazy and did not want to cite chapter and verse

[Waiting For Everyman]

3. Yes.

[AndyTiedye]

4. The Thing about Pendulums

Is that they usually swing way too far in one direction

[KharmaTrain]

5. This Economy Is Paralyzed...

The markets have been relatively stable for the past two months...around 8,000. So some could say the "floor" was hit, but that doesn't speak about the ongoing losses on the retail front nor the collapse not only of the real estate market but all across the economy as cash has dried up. It's foolish to invest as people keep losing jobs and homes...and credit is tight as a drum. A key of this stimulus package has to be to loosen up the credit markets...make banks solvent and then force them to either rengotiate loans or let the government handle it. The sooner they're not worried about covering losses, the sooner money will flow and a recovery can begin.

[Taverner]

8. Consumer Confidence is going down still

And I think until it hits bottom, the Dow won't

[KharmaTrain]

9. The Markets Are A Funny Animal...

It's interesting to see how the market is up today on the announcement of the loss of more jobs. I've seen this before where a company trims payroll and the stock goes up as investors believe that leaner and meaner means future profits. I think we've hit beyond lean and mean to bare bones.

You are right about confidence being the key...until people can spend nothing moves, but it starts with the businesses...especially small ones...that aren't able to get loans or credit that creates the jobs that provide the consumer to have the confidence. For so many years we've done is ass backwards...here's hoping this collapse allows the markets to flow from the bottom up once again.

Cheers...