Focusing on the Future

The economic recovery from the most recent economic recession (which ended in 2001) was the slowest recovery since WWII and below the historical average. At some point during 2009 it is anticipated that the economy is likely to hit its lowest point for this recessionary cycle. Just like it was "officially" suggested that the US experienced contraction almost a year after it truly began, it is not likely that we will "officially" know when the economy hit its "trough" and starts to improve until months after it occurs. Trying to time the economic bottom will be as difficult as timing the stock market bottom. As investors all we can do is try to position ourselves to benefit from the recovery when it happens. In that endeavor, historical experiences may be more reliable than they were in identifying the recession.