Despite those who think the boat will right itself quickly in 2009, the guys who saw the iceberg early continue to think the ship is sinking. Columnist, professor of economics and Nobel Prize winner Paul Krugman:
The fact is that recent economic numbers have been terrifying, not just in the United States but around the world. Manufacturing, in particular, is plunging everywhere. Banks aren’t lending; businesses and consumers aren’t spending. Let’s not mince words: This looks an awful lot like the beginning of a second Great Depression.
….the worst is still ahead of us. In the next few months, the macroeconomic news and earnings/profits reports from around the world will be much worse than expected, putting further downward pressure on prices of risky assets, because equity analysts are still deluding themselves that the economic contraction will be mild and short.
Happy New Year…–Cabbage Rabbit