How different 2008 from 1929

"The only thing we have to fear is fear itself." -- Thus spoke Franklin D. Roosevelt 75 years ago.

Looking back on Roosevelt's speech in 1933, 4 years after the infamous crash of '29, he was referring to the economic conditions of the time -- better known as The Great Depression.

In essence he was saying that if we can't shake our pessimistic economic outlook, it will be tough to turn things around. The question is... are things different this time?
The answer is yes and no.

People are still fearful of what the future holds and they have very little confidence in the economy. The big difference between the crash of '08 and the crash of '29 is that we now have India and China on the world stage.

Back in '29, both of these countries were not on the radar. In fact India was under British Rule. Both India and China's economies will suffer with the turn down here in the US.

They are now going to have to generate their own domestic consumption patterns for the goods and services they formerly sold to the US. This is going to be hard to do as so much of their economy is based on exports which are evaporating quickly.

The fact of the matter is that the markets are extraordinarily turbulent. We do not expect, even with the worldwide bailout, for things will be rosy again anytime soon.

However, that does not rule out some extraordinary trading opportunities in the markets. This is a time for rational thinking. It is also a time to eliminate fear from trading. There is no need for fear in one's trading plan if you're running with a diversified program that has proven to be successful over time.

"The only limits to our realization of tomorrow will be our doubts of today." -- Franklin D. Roosevelt