Stocks Face Long Road Back to Pre-Recession Heights

(iStockphoto)

The economy may be showing signs of recovery, but the stock market is still a long way off from it's pre-recession highs of October 2007 and it may take new bubbles in the energy and credit markets to bring them back, according to a Wall Street Journal report ($) Wednesday.

Neither, of course, would be desirable, the paper notes, so investors may just have to deal with a slower-than-desired market rebound.

The report points out some impressive numbers:

Despite a 47.5 percent rally since March, the Standard & Poor's 500 index is down $4.8 trillion in market value since October 2007. It would need a 57 percent gain to return to that level.

Among the hardest sectors hit are financials, which account for $1.4 trillion, or nearly a third, of the $4.8 trillion in total losses since October 2007.

Energy companies have also taken a beating, losing some $500 billion in market capitalization since the collapse of Lehman Brothers last year.

Now, those pre-recession levels may have been inflated to begin with, fed by an unsustainable housing bubble and debt-driven profits. But if the market is ever to return to those lofty heights, it will likely have to pace itself.

[bmirarck2]

Thanks to our dearth of MBA MORON's America no longer has our manufacturing sector to lead us out of a recession. Once again we face a jobless recovery. The pain will continue. I just love state tax supported college's training the next crop of MBA's to send our jobs offshore, then stand there, with their thumb in their azz, wondering why it's all turning to s.hit!! Close ALL Law schools and MBA programs for 50 years until they all die off!!