Judging only by the stock market of the past few days, you'd think we were heading right into a repeat of the financial crisis from 2008 and 2009.
The losses are brutal, but there's a key difference between now and then: The economy is a lot more solid.
1. Consider jobs - companies are hiring
Today employers are hiring, adding nearly 3 million jobs in the last 12 months. That's a job market more like the white-hot days of early 2000, not 2008.
The U.S. unemployment rate is down to 5.3%, near what is considered full employment, and just over half the peak in unemployment reached in late 2009. That's helped to lift average weekly wages 2.4% over the last year.
Going into the financial crisis of September 2008, employers had been cutting jobs every month since February. Job losses reached 452,000 the month of the meltdown, and accelerated from there. More than 4 million U.S. jobs were lost in 2009.
2. Home prices
Homes, not stocks or bonds, are the biggest investment most Americans make. And that investment is doing very well.
Home prices nationally are up 4.4% on an annual basis, according to the most recent reading of the Case-Shiller price index. That's not the kind of rapid double-digit rise that led to the housing bubble of the 2004-06 period. But it's been enough to restore most of the value that many homes lost when that bubble burst soon after that peak.
Home values were plunging about 10% in 2008, a drop in value that caused massive losses across the financial sector, bank failures and precipitated the crisis in markets.
3. Economic growth
Yes, it'd be nice if economic growth was stronger than it is today. Growth in the second quarter was only 2.3%.
The same is true of other major economies. The Eurozone has weathered the latest Greek crisis and is growing at about a 1.5% annualized rate.
But once again, a look back shows there is no comparison to the problems in 2008 and 2009. The U.S. economy shrunk by 0.3% in 2008, and by 2.8% in 2009, which was the biggest annual drop in more than 60 years.
So growth might be slower than preferred. But there is growth around the globe.
4. Oil prices
Yes, low oil prices are spooking investors and helping to send stocks lower. Jobs are being lost in the U.S. oil patch. But the low prices are good news for the U.S. economy overall, helping to put more money into the pockets of consumers. Most U.S. drivers should be buying gas for less than $2 a gallon later this year.
China, whose slowing economic growth is another big concern for markets, is a major beneficiary of lower oil prices as well, as is Europe.
In the summer of 2008 oil prices hit a record high of $145 a barrel, taking gas prices to records that still have yet to be matched. It wasn't the cause of the economic problems that year, but it was a contributing factor.
