So much for the hip-hip-hurrays on Wall Street. After it looked as if the economy was saved, things took a dramatic turn for the worse. Stocks fell fast and hard as brokers’ hopes and dreams were snatched away from them. A big drop in retail sales and a Federal Reserve report that said tight credit conditions are hurting businesses across the country definitely didn’t help the situation.

The word “recession” keeps popping up and as time passes, it really looks as if we are headed towards one. The Dow is down about 733 at the 8,577 level. Reported by the Federal Reserve in Wall Street’s little black book technically called their “beige book,” it had been discovered that the economy continued to slow in the early fall as financial and credit problems grew worse. Also, difficulties in obtaining loans have “choked growth in wide swaths of the economy.”

“Even though the banking sector may be returning to normal, the economy still isn’t. The economy continues to face a host of other problems,” said Doug Roberts, chief investment strategist at ChannelCapitalResearch.com. “We’re in for a tough ride.”

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Alas, the market is up and everyone on Wall Street applauded when the closing bell rang. After a week that scared the entire nation, things have turned around. The surge came as execs from leading banks were invited to join the Bush administration in Washington to work out a plan to get loans in order to save the economy from further destruction. Gaining more than 11 percent, the Dow reached its biggest one-day rallies since 1933.

In the early morning hours, stocks opened high and kept on going. The Dow was up more than 400 points within minutes and by lunch, it crossed back through the same 9,000 level it crashed below the following week.

“My screen is completely green, and I love that,” said John Lynch, chief market analyst for Evergreen Investments in Charlotte, N.C. “But I’m not doing any back flips yet. We still have many challenges up ahead.”

When the horns on the floor of the New York Stock Exchange finally blew, a wave of relief was felt by everyone. Hope is on its way!

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Initially having high hopes regarding President Bush’s $700 billion rescue floats, people are now discovering that there still isn’t a way to stop the “Titanic” from sinking. Therefore, lawyers are encouraging their clients to jump ship! Still, Wall Street brokers were hopeful that somehow, the floats were merely a sign that more would be magically done to repair the ship’s leak. However, on Monday, the Dow Jones industrials skidded more than 500 points and fell below 10,000 for the first time in four years.

According to the AP, “Investors around the world have come to the sobering realization that the Bush administration’s $700 billion rescue plan won’t work quickly to unfreeze credit markets. Global banks, hobbled by wrong-way bets on mortgage securities, remain starved for cash as credit has dried up.”

“The fact is people are scared and the only thing they’re doing is selling,” said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research. “Investors are cleaning out portfolios and getting rid of everything because nothing seems to be working.”

The bottom line is that the stock market is a leading economic indicator as to where the economy will be in six to nine months. And with only 98 stocks that rose on the NYSE and 3,114 dropping, it looks like we are headed for a tragic economic downfall in the weeks to come.

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