Landscape Architect Articles

Another Stock Market Debacle Deepens Economic Problems Early This Year04-01-09 | News

Another Stock Market Debacle Deepens Economic Problems Early This Year

The stock market has rallied in recent days, on the backs of financial companies of all things, but the market remains deeply in bear territory and the durability of the recent rally is highly in doubt. Image courtesy of www.dealbreaker.com

The stock market apparently had hit bottom early last November, and the market managed to stage a modest recovery over the balance of 2008.

But then the equity market took another major leg downward, carving another $2 trillion from household net worth and decimating the attitudes of consumers, businesses and financial market participants alike.

Available evidence on economic activity for the early part of 2009 points toward contraction of all major components of real final sales (inflation adjusted) other than spending by the federal government on national defense.

Another major decline in GDP definitely is in the cards for the first quarter ?EUR??,,????'??+ we?EUR??,,????'???re currently estimating -5.5 percent ?EUR??,,????'??+ even if the stock market continues to improve over the balance of this month.

With respect to housing production, we?EUR??,,????'???re expecting residential fixed investment to contract at an annual rate of about 40 percent in the first quarter, the largest quarterly contraction of the entire downswing. This is virtually inevitable in the wake of a massive downshift in housing starts late last year and early 2009 that?EUR??,,????'???s taking residential construction put-in-place down sharply at this time. ?EUR??,,????'??? Courtesy of NAHB