The week that was...glad that it is over!

To keep things in perspective, I think it would be useful to look at some thoughts on Bear Markets, from Scotia Capital

BEAR MARKET STATISTICS

Several advisors have asked recently for some historical perspective on this current bear market. Attached is a table from Scotia Capital with data for both the Canadian and U.S. markets looking back through several cycles.

The good news is that the data demonstrates that rebounds always occur and that returns from trough levels are substantial.

We would caution however that although we are close to average decline levels in both Canada and the U.S., the current situation should not be considered "average" by any measure. It is worse this time.

Bear markets trough during recessions, they don’t wait until the end of the recession has been identified. Having said that, consensus opinion is only now acknowledging that the U.S. is falling into a recession and that the rest of the global economy is heading in the same direction. The credit crisis is significantly worse than most peoples' worst fears and the U.S. financial system is in terrible shape.

As we have stated previously, stability in the U.S. housing market, or some anticipation thereof, is a vital pre-condition for any sustainable upward move in equity markets. Recent market volatility will likely be the norm for some time to come.