"The final phase is a self-feeding panic, where the bubble bursts. People of wealth and credit scramble to unload whatever they have bought at greater and greater losses, and cash becomes king"
-Manias, Panics and Crashes, the HousingPANIC bible
Depending on the situation, for most Americans with crashed home values, destroyed 401k's and the prospect or reality of job loss, panic is now here. As well as capitulation, despondency and depression.
Talk to someone who's lost their life's savings, who's been removed from their foreclosed home, and who has no job or prospect of getting a new one, it's bad.
And yes, it can still get worse.
But all in all, I think we saw true panic a couple of weeks ago when the market went into freefall and the governments bailed out the banks, and now we're in capitulation and despondency as people deal with the reality that they can't retire, that they've lost everything, and that they're on their own.
But that's unfortunately what has to happen if we are to finally start with the recovery.
So, how long will this period last, will it get worse before it gets better, when will the recovery start, and what will the world look like after we emerge?
And when will hope begin again?