Dow has declined 35% since this date last year

And its going to get worse. This is how I see it First, there was the housing/mortgage crisis due to bad lending practices and poor regulation. But when you really look at the housing market closely, it really isn't that bad, except in CA, FL, AZ and NV. Then, there was/is the derivative/credit swap that has taken down the likes of Bear Sterns, Lehman Brothers, and required a bailout for AIG. The derivative/credit swap crisis basically still exists and is facilitating the credit crisis, where banks are afraid to lend to each other, shutting down credit markets, which, in turn, is finding it's way to Wall Street and international equity markets as a result of a projected world recession due to lower projected corporate incomes. Ultimately, the credit crisis will hinder local business from borrowing and hiring new employees and making investments, which in turn will cause a slow down on Main Street. Additionally, falling values of 401k and housing values will cause consumers to limit their spending multiplying the slow down on Main Street. Things don't look good, but in two years things will be fine again. The worst will be behind us.