Having seen off the era of irrational exuberance where anything labelled asset moved fiteen fold in value, we (investors, bankers et al) in danger of asphyxiating the economy due to our reckless caution.
In the UK, banks lent £459m in Ocotber in mortgage loans, compared to £1.5bn in September and £8bn in October 2007. They are now in danger of strangling the housing market completely. And next? Will come repossessions which will then prolong the recovery of the housing market without which consumer won't spend meaning economy recession lasts longer.
Stock investors are being so cautious that markets are now finding new lows on a weekly rather than monthly basis.
Still you get the occcassional "foolish optimist" who calls every new market low as the bottom. Some even have new theories about markets being 6 months ahead of real recovery.
Market will only reach bottom when the housing market does.