Unfortunately, They R Rite!

Six out of ten American people are now worried that a full-fledged depression is more than just ‘possible’ – CNN poll, Oct 6 2008

In last depression – the life savings of millions wiped out, banks a smoking ruin..thousand of companies bankrupt, 25% unemployment rate and more were struggling day to day just to survive.

We have every reason and right to be worried.

Warren Buffett’s word in recent days …’In my adult lifetime, I don’t think I’ve ever seen people so fearful economically as they are now’

Of course, this sounds alarming and I have been accused to be melodramatic, but the truth is nothing but the truth.

My mother asked whether she should move her retirement account to another institution, and over the past three weeks, I was questioned on the markets by nearly everyone I encountered.

That likely to mean more downside for stocks in the short term. The average bear market in the S&P 500 has seen an average loss of 34.1% over 20 months and so far the index down 20.5% from its high made on October 9, 2007. The last bear market, which lasted from March 2000 to October 2002, it took the entire index down 49.1% over about 30 months. The fiercest bear occurred back in 1937 to 1942, with the index losing 60% of its value over 62 months.

All these numbers show to us that there could be plenty more pain ahead. Of course, there also reasons to be greedy at this point of time. During the average bull market, we are talking a whopping 164% return over 57 months.