Once in a couple of generations there is a major hangover. This one has occurred about 80 years since the last one, and prior to that it was about 55 years. I don't think we are heading toward another Great Depression, and for many reasons. This latest swoon is the result of excess, not unlike the Roaring 20's. This blow will be cushioned by multiple users, as a global downturn. Think in terms of scale -- more population, more participation and more disappointment. I'm optimistic about the future, and I don't see 25% unemployment, nor do I see bread and soup lines beginning to form. There's more pain on the horizon, but let's give it some time before we mark the end.

A Bottom Does Not Signal Recovery

I'm tired of all the bottom callers, knife-catchers and serial buyers. They're everywhere, but clearly in denial about what's happened here. Wall Street tells you to buy because they know nothing else. Cash is not an option for money managers even if it's the safest vehicle. How many bottoms have been called since the market started to fall in late fall?

Endless calls to tell us to buy, the'bargain of the century, even Warren Buffett telling us all to put our money to work. He at least put his money where is mouth is, but that hasn't worked well so far, as Goldman Sachs and General Electric are down nearly 50% on these investments in just a couple months. The more we ignore the advice and empower ourselves to make the right choice with our capital the better off we'll be. When will a bottom be in place? Bottoms are moments in time that are ultimately elusive, but we'll know after it's made.

Retail Has Been Given a Premature Death

The consumer makes up about 70% of our GDP. That's an enormous burden on the public to keep on spending, and when it appears buyers are nearly tapped out with no more home equity withdrawals, clearly an adjustment is going to be made. Some are calling this holiday season to be the worst ever. In fact, hundreds of store closures have occurred or will happen after the new year rolls around. But is it all bad? I still see buyers of Starbucks coffee, Walmart is packed each weekend in my town, and new Costco's are being built with wild crowds showing up. November 28, Black Friday, is a critical day for retailers. I'm not sure how big it's going to be, but retailers have started to discount heavily. Expectations are the lowest ever. While the winners and losers are sifted, but the hungry buyer will never completely disappear.

Banking Situation Needs Resolution

Banks are certainly one of the lynchpins of recovery for our economy. Without some stability and confidence the economy will just muddle through a very tough period. Much of the blame for the credit crisis falls on their shoulders, but it's time to stop passing out blame and fix the problem. Time will cure all the ills, and the actions so far will eventually help. I'm not sure if there is even a silver bullet solution, but someday banks will start lending again. They aren't doing it now, even with the flood of capital, but who can blame them? Hit by a downturn in housing, business and the consumer, one can understand the hesitancy. Banks are still closing due to poor loans and investments. Citigroup is in big trouble and is casting a wide net of uncertainty. The collateral damage could be devastating. If there is some kind of solution here, we could at the very least see some stability into the first quarter of 2009.

Price Headley is the founder and chief analyst of BigTrends.com.