optimism

Is the Worst Over?

No, that headline is not a typo. After bottoming out recently at levels unseen since 1997, major stock indexes are up almost 10 percent since Monday. The rally reflects broad optimism over a string of positive economic developments this week that has some questioning if the worst of the crisis might have passed. In particular, positive earnings reports from Bank of America and Citigroup, which have sat at the edge of bankruptcy for much of the last month, bolstered confidence that the financial sector will survive the downturn. Even some less encouraging news wasn't as bad as expected—General Electric's credit rating was downgraded, but not as far down as some predicted. Still, economists are warning that major challenges remain and recovery is still some time away even if the stock market stabilizes.