Fired and Foreclosed
Jim Cramer, Larry Kudlow, Vince Farrell and many other analyists believe that the stock market bottomed in mid March with the Bear Stearns bailout. I don’t agree because this is not only a Wall Street crisis. It is also now a Main Street crisis.
In 2007, the stock market was able to stay strong because the unemployment rate was low. A person being foreclosed upon could still rent an apartment because he still had a job. Here in 2008, a person might be faced with being fired and foreclosed upon at the same time. That’s a nasty combination.
The Wall Street crisis may be fixed, but the Main Street layoffs have only just begun in January, and are getting steadily worse. The economy is accelerating downward. I don’t think the stock market can bottom until we see the speed of layoffs let up.
