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As of this writing, we find the S&P 500 down 8.6% for the week and the month of December, so far. Yet it remains 10% above its intra-day low reached Friday two weeks ago. The economic news has been as bad as expected and government counter-moves have been about as good as could be expected, with lame-duck limbo in full swing. Both Democrats and Republicans are warning Paulson that he may not get the additional $350 billion TARP funds.

It comes as absolutely no surprise that the massive bankruptcies and bailouts of September and October were enough to freeze both consumers and businesses in their tracks. The government numbers for the next couple of weeks are nothing more than a post mortem exercise to confirm the obvious. However, as we move forward a couple of weeks to get beyond the period of absolute shock, the reports will begin to provide clues about the possible breadth and depth of this recession.

Information travels faster than ever now which tends to amplify panics and crises. The natural herd tendency to sell or buy is fanned by the rapid flow of news, often in its raw state. Globally linked computerized exchanges make buying and selling more efficient and faster than ever. What is crystal clear in this time of crisis and uncertainty is that we have no control of the markets (short of shutting them down). They are bigger and more powerful than any government and they will find their equilibriums in all circumstances. Predicting or timing them is all but impossible, especially over full cycles.

Those of us over 40 don’t need reading glasses to know how bad the news is; headlines are full of it. And there is plenty to come in the weeks and months ahead. The economy is collapsing at an astonishing rate as we enter the self-perpetuating recessionary cycle. Banks aren’t lending because they are afraid of the coming recession and the recession is growing deeper because banks aren’t lending. Businesses are firing because demand is evaporating and demand is evaporating because businesses are firing. House prices are falling because no one is buying, and no one is buying because prices are falling. The worse the news gets, the more the consumer hunkers down.

With each passing day more of the dark corners of uncertainty are illuminated. A few goblins lay in wait to surprise us in the coming weeks (like pension funds and corporate real estate), but most have reared their ugly heads by now. The world’s financial system is slowly and systematically being purged of its ills, though recovery will be a long and painful process.

Everyone is wondering if there is a bottom? Markets around the world tumbled yesterday on the same fears driving our markets down. How badly will a global recession hurt corporate profits? As investors sell on earnings fears, they exacerbate the fragile stability of the credit markets – a self-perpetuating spiral. Every drop in stock prices reduces further the assets of banks and corporations, suggesting that an increasing number of them will have trouble paying their debts.

The party’s over, the bills are due, and the place is a wreck. Years of excessive you-name-it have brought the global economy to the brink of ruin. Perhaps the “boom!” in the Baby Boom generation will define it. Everything about it has been noisy and big. Moms of this generation had the new how-to guide in Dr. Spock’s The Common Sense Book of Baby and Child Care, which was second only to the Bible in sales.

News continues worsen in financial markets throughout the world. No economy is free from the carnage with more than $25 trillion erased from global equities in 2008. The Dow Jones Industrials index is now down more than 43% from its record high a year ago. This week represents the worst for the S&P 500 since 1933.

We began the third quarter with most of the major stock markets in bear market posture, off 20% or more and we continued to decline from there. The Dow Jones Industrials dropped another 4.4% while both the S&P 500 and the Nasdaq fell over 9% more. From top to bottom the Dow lost a maximum of 27% while the S&P and Nasdaq toppled 30%.  It was a quarter of ugly new records as the largest bank in US history failed and the largest US insurance company appealed for government help. Every investment bank on Wall Street is now gone. The nation’s first money market fund the Reserve Primary Fund went below a dollar a share or “broke the buck” when Lehman defaulted on a large chunk of debt owned by the fund. The rates banks charge each other on loans reached record highs bringing those markets to a standstill. In fact, it’s hard to find a market that has not been significantly affected by near and complete freezes in credit flows. And broken record or all broken records, by the end of a three-month ordeal Wall Street finds itself begging for help from a less-than-sympathetic US House of Representatives.

As yet another bank fails and the stakes get higher, Congress and the White House continue to argue over the best plan for recovery. These are political institutions with some of the best politicians (best at being political) in the world, so it is difficult if not impossible to remove the political aspects of a public debate of this magnitude. And if you take your news and views from television it may be nearly impossible for you separate your emotions from the situation because these pols are so skilled at arousing the passions of those on their side. But if you can suspend your ire from the events of yesterday for a few moments a better understanding of the ideology behind what is going on might be possible.