The Bottom is near.
Bottom of what?
Stock markets, housing prices, bond markets, commodities and the like are showing signs of being near the bottom of there current values.
Don't think of these markets are having a true bottom, think of this as a natural event taking time. No one true moment will be the absolute bottom, however when looking back we will see what dips an bumps are truly the bottom of each market. Think about several bounces occurring, kind of like a ball bouncing down a stairway. Even after the last step, the ball will keep bouncing.
I truly feel we are near the bottom of the stairway. That being said, I don't see a large recovery in the housing values anytime soon either. Rather an evening out of values, showing stability in the market, and finally another growth in values. This will come when the jobs markets start to improve. So If you want a crystal ball of the future, look at the jobs reports. When your market area shows signs of strength in the jobs numbers, your housing market will follow.
Stats as evidence:
Of the 8 bear markets for the S&P 500, the average length of time from the index's bull market closing high to its bear market closing low has been 13.5 months. The index's most recent bull market closing high (10/9/07) occurred 12.5 months ago. (source: BTN research.)
At the bottom of the 2000-2002 bear market, the S&P 500's low closing value was 776.76, down 49.1% from the index's all time closing high. The S&P 500 closed last Friday 10/24/08 at 876.77 down 44.0% from the index's all-time closing high. (source BTN Research).
The national average price of gasoline peaked on 7/16/08 @ $4.11/ gal. Last Friday, 10/24/08, the national average price of gasoline had fallen to $2.78, a drop of $1.33/gal. Since every 1 cent of reduction in the price of gasoline saves Americans $3.4 million a day, a drop of $1.33 equates to a $447 million daily savings for the US consumers. (source: AAA, Wall Street Journal, Fortune).
The Fed's will hold there regular scheduled meeting this week. Look for another drop in the fed money rates; this should loosen up money for banks, and consumers alike.
The elections are near, and history has a way of improving things around election time, especially when it's a presidential election
Volatility will remain in place, but stabilization is not far away.
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