WASHINGTON - Stocks tumbled, Friday, but managed to regain some ground after Wall Street fell to its lowest close in more than six years, Thursday.
The last time it was this low was when the post-9/11 recession bottomed out. The Dow has lost 47 percent of its value in just the last 16 months.
Click the player to watch the report from CBN News Senior Washington Correspondent Paul Strand followed by Gordon Robertson's comments on the economy and the Obama administration's stimulus plan.
This has set off investor fears the fall may be far from over, despite all the trillions of dollars the Obama administration and Congress are throwing at the economy.
"Investors are not convinced that these programs are going to work, that they're going to be enough. In the meantime, the news in the economy has been very bad and they just don't see the light at the end of the tunnel," said Alan Skrainka, chief investment strategist with Edward Jones.
The Dow has lost 47 percent of its value in just the last 16 months, the worst fall since the brutal bear market the 1970s. The only time the market fell much harder and further was in the Depression years of 1929 to 1932 when it lost some 90 percent.
No one knows where the market will bottom. Some analysts think the Dow could go to 6000. But one piece of good news: a real turn in the market should signal a turn in the economy.
"Stock prices tend to bottom out about five months ahead of the end of the recession," said Sam Stovall, chief investment strategist with Standard & Poor's. "They also tend to bottom out around eight months ahead of the peak in unemployment."
One of the worst hit sectors -- banks. heir stocks fell to a 17 year low on fears some may be in such bad shape, the government will have to nationalize some of them.
And on his first trip outside of the country, President Obama assured Canadians the U.S. won't make a bad recession worse by engaging in protectionism and hurting free trade.
"I want to grow trade and not contract it," Obama told Canadians in a joint news conference Thursday with the Canadian leader. "We've got to be very careful about any signals of protectionism."
He said countries worldwide have to guard against the urge to protect their own businesses by raising trade barriers.
"There's going to be a strong impulse on the part of constituencies in all countries to see if we -- they can engage in beggar-thy-neighbor policies," he said.
The administration is hoping the stimulus bill the president signed this week will boost the economy. But Republicans have their questions about how successful the bill will be.
Rep. John Cornyn said that the much stimulus funds meant to help ailing state economies is throwing good money after bad.
"And what it does is give money to those states that have done a bad job in which has been running terrible deficits, course they are anxious to get that money," he said.
Today the President meets with mayors about using millions of those dollars to finance some of their cities' biggest needs. It's all an effort to prevent this bad recession from getting worse.