First, the "Window" opened up (commodity prices collapsing and mass asset destruction which essentially removed tons of potential money which meant inflation was not an immediate threat and there was a worldwide demand for US Treasury debt) - evident 1/19.
Second, "Some Interesting Things" happened (bottoms forming in the first economic areas to turn down - US housing - most importantly in San Diego where the boom/bust first started, the US stock market, and commodities) - evident 3/4.
Third, now we have the "Follow-Through", with the stock market further confirming some sort of bottom actually happening in concert with some solid economic indicators. Some of the indicators are 1) Citicorp actually showing some reason for hope in the financial sector even if Citicorp isn't safe yet as they still will have large writeoffs in about a month. But, it does show that Fed actions and TARP have had some positive effects - a favorable yield curve plus LIBOR rates now reasonable - so well-run banks will surely be doing pretty well. Plus, recent buyouts of Wyeth by Pfizer, Schering-Plough by Merck and a pending completion of the Roche takeover of Genentech - indicate several things -money is available, investment banking has awakened, plus as our healthcare system begins to change, healthcare companies are beginning their adjustment by eliminating costly duplications, building synergies, etc.
Sure, this mess will still get worse as unemployment is still rising, commercial RE has much further to fall, same with credit card debt, likely some Eastern European nation will collapse and some Latin American country - maybe Mexico, plus some major geopolitcal event(s) will likely happen. But, the important thing is there are some positive indicators where this mess first hit. Sure, likely this is just a bounce in the stock market and further lows could be hit, but some stabilizing is happening for some fundamental reasons.
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