Bear Market A Year Old

The "Bear Market" on Wall Street is a year old today.  That is one of the biggest headlines in today's news.  Okay, so what exactly is a Bear Market, you might ask?  Well Wikepedia explains a Bear Market like this:

"A bear market is described as being accompanied by widespread pessimism. Investors anticipating further losses are often motivated to sell, with negative sentiment feeding on itself in avicious circle. The most famous bear market in history was preceded by the Wall Street Crash of 1929 and lasted from 1930 to 1932, marking the start of the Great Depression.^[5] A milder, low-level, long-term bear market occurred from about 1973 to 1982, encompassing the stagflation of U.S. economy, the 1970s energy crisis, and the high unemployment of the early 1980s.

Prices fluctuate constantly on the open market; a bear market is not a simple decline, but a substantial drop in the prices of the majority of stocks in a given market over a defined period of time. According to The Vanguard Group, "While there’s no agreed-upon definition of a bear market, one generally accepted measure is a price decline of 20% or more over at least a two-month period."^[6]

Investors frequently confuse bear markets with corrections. Market corrections are shorter than a bear market and have a total measured decline of less than 20%^{[citation needed]}. Bear markets on the other hand occur over a longer period with typically greater magnitudes of decline in prices from top to bottom. The distinction between the two is not absolutely clear when there is a price decline between 15% and 20%"

So What exactly does this really mean?  Well, in plain English, a Bear Market is one in which everyone is afraid and uncertain.  They don't want to hold on to their stocks because they are afraid of even greater losses.

Well, what else is new?  The market has been on a downturn for a while now; and for the past week and a half, along with the economic crisis and all the problems the credit crunch and the housing crisis are bringing, the market is getting steadily worse.  The trouble is - it is really hard to blame the investors for being afraid.  They have good reason to be!

According to President Bush, the $700 Billion dollar Bail Out plan was both very necessary and the solution to these economic problems.  However, it would appear that if the housing market does not begin to recover, the bail out plan will not work.  So how did it actually fix anything?  So far the only things that I can actually see that the bail out plan has accomplished is to:

1). Cost the tax payer's $700 Billion Dollars

2). Increase our already large National Deficit by $700 Billion dollars

So again I ask, what have we actually fixed and accomplished with this plan?

Until we can fix our lagging economy and solve the critical financial problems that are facing our nation, we will continue to have a bear market that continues to fall.  Investors will continue to be afraid of loosing their investments and will continue to sell their stocks for a loss, rather than risking loosing even more in the future.  Hopefully the government will come up with a workable solution soon, and begin to actually solve this terrible economic crisis that is rapidly steering our nation toward a depression.