Best Columns: Dark clouds, Silver lining

The rebound that wasn’t

Well, “so much for that second-half rebound,” says Steven Pearlstein in The Washington Post. Despite months of “happy talk from the Fed and Wall Street,” the economy is now in “one of those vicious, downward spirals” that is very hard to pull out of. And it won’t “this summer. Not this fall. Not even next winter.” The main problem isn’t even $140-a-barrel oil, it’s that our “underlying fundamentals” are “badly out of whack.” Things won’t get better until our consumption falls in line with our production, the dollar falls “to its natural level,” and real estate prices “fall in line with incomes.” In other words: “It will be a while.” Meanwhile, there’s little to do but “flee to safety, rescue those in trouble, and let nature take its course.”

Investing through the downturn

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“Yes, the market may fall further,” says Brett Arends in The Wall Street Journal, but for the “surprising number” of people who don’t know this: “The further share prices fall, the better they become as an investment.” If you’re under 60, or saving to “put your kids through college,” or worrying about taking care of elderly parents, or trying to leave something for your kids—in other words, “pretty much everybody”—“this is the time to find some more money to put into the stock market.” A market that is down 20 percent will produce 25 percent better returns. And besides, how else can you beat inflation? If you stash your money “at the back of the sock drawer,” it will “lose half its value every fifteen years.”