I think it is definitely the toughest time in our generation although it is nothing compared to what our granparents experienced in the great depression. In urban areas we do not feel it as much as people who live in say Detroit - people who have watched plant after plant close down and are left with no options to support their families. that makes me very sad. I am also disappointed/sad about all the people who lost their homes because they were approved for loans that were not appropriate for them. As far as IndyMac, the Fed coming in to bail them out was the best possible outcome for those customers. If not it would have all gone to zero
Freddy Mac and Fannie Mae are being helped out by the Fed now. Hedge funds are investments companies that can "short" a stock. Meaning, they speculate that the stock is going to fall in price so they borrow it from an investment bank and when the price falls (ideally to almost 0) they sell it back and profit from the difference in price. the Fed banned shorting Fannie Mae and Freddy Mac to prtect them from short sellers. When the Fed steps in it is usually as a last resort to save a company, but some people would argue that is is unhealthy for the economy for the Fed to be so active. Ideally in a capatalist society the "weaklings" should be flushed out. Not sure I agree with that because of the impact on jobs etc....
The economy is cyclical in nature and there are going to be valleys. it is tough, but you have to be optimistic about the future. The only question is the timing. For people who have disposable income now is a good time to buy stocks because they will inrease in value. just don't quote me on the date
hang in there yari!!! There's a light at th end of this tunnel!