When I look at today s market, I am reminded of Franklin Delano Roosevelt s quote, The only thing we have to fear is fear itself. Right now we are in the early stages of an economic change of direction. Still everyone is fearful because change creates fear.
Consumers are worried about layoffs and their confidence is declining.
Businesses are cutting back, taking write-offs and altering business plans as profits fall short of expectations. Investors are concerned because of earnings disappointments and pullbacks and even collapses in some stocks. Politicians are worried because no one knows where the bottom will be. In such a gloomy atmosphere, business sales growth declines. Inventories bloat and have to be worked down.