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Is the Downturn Past its Midpoint? Or Only Beginning?

Depending which manifestation you look at, the credit crunch has raged anywhere from three to 18 months. Is the tide about to turn?

Housing has been correcting for more than a year. Financial markets began adjusting to changed circumstances roughly nine months ago. Even the broad U.S. economy has already endured three or four months of recession, according to some economists. And recent events give little sign of an end in sight.

"It's always darkest before the dawn" is a pop cliché, not an analytical tool. Still, in view of the above timeline, it's reasonable to consider whether the downturn has completed at least half of its likely time span.

Do you believe it has? And, whether optimistic or pessimistic, does your estimate of where we are in the cycle influence your career plans in any way? Post your thoughts below.

AUTHOReFinancialCareers News Insider Comment
  • Co
    2 June 2008

    If your dependant on the US economy as your sole indicator of the job market then the near future looks bleak. Many of the financial sectors jobs are global, so if you cant find what your looking for in the US, then look to the UK or Australia. Australia's job market is booming and there is demand in the finance sector. Besides earning dollars right now is not fun, since its dropped so much. I was at Heathrow the other day and the dollars purchasing power in London is pathetic.

  • sh
    30 May 2008

    in my opinion, the economic is in downturn for sure, and it will continue long enough until the facts of subprime market problem become clear, the food inflation across the world get soloved, the rising oil price and the other commodity price have a nice landing... after all these, the worlds economy will be resharped, follwoing strong growth from the emerging market and steady reform in the developed western regions. during this time, the finanical sectoer will remain unstable with low revenue. the job they need to really get on with are some restructure of their business model and the risk models. ( e.g a better way to turly valuate risky loan or mortagage products), at same time, waiting for the government's new regulation.

    overall, the world 's main economy is resturcturing with many industries facing new cost of material and lidiquidy problem. thing could be go better in 2010, then new problem comes.

  • Ja
    27 May 2008

    The economy is soft. However, it is not as bad as the media portrays. I think there are many undervalued stocks. By the end of the year, many stocks will be up.

    I am not bullish on large bank stocks. However, I was stock screening on May 23, 2008. I seen many regional banks 1-3 billion market cap registering bullish trends. What's up with that?


  • Da
    David G
    12 May 2008

    This is just the begining, Alt-A, Option Arms(the next MAJOR time bomb), CDS,CDO, and housing prices that will continue to decline to '03 prices or lower will destroy the balance sheets of Banks, IB's, Hedge Funds and anyone long US equities. Fed ex after the close on Friday should be a loud and clear warning that things are about to get fugly.

  • Nh
    9 May 2008

    Recession???I think the National Bureau of Economic Research will say otherwise. And even though the current economy has been battered by the housing crisis and rising energy prices the economy still GREW at .6% and that's still at least $540 billion on top of what was spent last quarter. If Investors could stop inflating the Commodity indexes we might see lower prices at the pump.

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