Market Review and Outlook 1st Quarter 2009
To the relief of almost everyone, 2008 is over. You are probably tired of reading about the meltdown in the stock market, the excesses and the bailouts. For the first time in 28 years, the world is in the midst of a consumer-led recession. The cause, put simply, was the unprecedented availability of inexpensive credit used to excess in certain markets and in certain industry sectors such as housing. The sources of that credit – primarily large commercial and investment banks – mispriced credit by under-assessing risk. These and other mistakes put the world’s entire financial system at risk, to the point where the governments of free market countries had to take unprecedented steps requiring staggering amounts of taxpayer funds.