Major stock indexes got worked on Monday.  They fell by more than 2 percent... the Dow Jones industrial average plunged 201 points, after the World Bank estimated the global economy will shrink 2.9 percent in 2009. It previously predicted a 1.7 percent contraction.  How can you be that off on your previous prediction.  I've been saying this is going to happen the whole time.  Take a look at my Twitter from 32 days ago!  I had to take a break until the correction finally came because the market was going up for no reason.

People are blogging, writing, and talking about how this has eroded hopes that the economy was starting to emerge from recession... there was never any sign of recovery.  It was all smoke and mirrors during earnings season in the first quarter.  People were just sick of negative news, so they started to buy and pushed the market up without the performance to back it.  Things weren't improving... they were going from absolutely terrible to pretty damn bad.

Sony is set to cut their suppliers by half... That's a big time cut and the effects will be far reaching.  It will have a domino effect - the suppliers will have to cut jobs due to Sony's cost-saving measures, then that supplier's supplier will have to cut jobs and so on.  Companies are hitting their number by cutting costs (jobs)... there's no actual growth.  The only good thing coming out of this is maybe they'll finally cut the price of a ps3.

Read more here.

Yes, 600 mid-sized banks would fail the stress test!  That's a lot of banks.  And the biggest problem is commercial real estate... which is the next piece of the bailout puzzle.  How long are we going to throw money at these black holes?  The most inefficient parts of our economy?  Why don't we let it get worse on its own before it gets better... let the free market work itself out.

Read more here.

Thought it was getting better?  Think again.  I've been saying for months that this isn't going to bet any better for a few years... except for oil and gas will slowly creep up into the expensive range again... which it has.  Check out earlier articles with predictions on gas prices.

Read more about housing here.

Gun makers are loving the 2nd Ammendment.  Sales of ammunition and firearms have blown up since the election of Obama.  There is a "get your guns while you can" attitude that equals record profits for companies like Smith & Wesson and Sturm, Ruger & Co.

Sturm, Ruger & Co. (RGR) quadrupled its first quarter profit and the stock is up 82 percent year to date.  Smith & Wesson Holding Corp. (SWHC) shares are up 190 percent!  As long as there is uncertainty in the economy gun sales will remain strong.  Get yours while you can... but make sure you have ammo, it's selling out as soon as it hits the shelves.  Maybe this year's must have Christmas gift will be a Smith & Wesson and some bullets... all a 5 year-old could ever want.

If you haven't heard of Facebook then you probably still have a pager clipped to a leather woven belt and have a mustache... get with the program.  If you just have a mustache then you're OK.

Facebook is almost finished raising $150 million to buy out shares of hundreds of regular employees.  Many of the employees have been at the company for years and want to get in on some of the projected value Facebook has created.  Many of the employees were given several thousands of shares valued at less than a buck, but now investors are willing to pay around $10 for the shares... that's some serious cash.

According to sources famililar with the transaction, it will include the buying out of roughly 15 million common shares... that's where the $150 million figure comes from.  That's chump change compared to the $1.3 billion it's been valued at in the past.  However, it's still not a profitable company;  that's supposed to come by 2010.  Shouldn't you be making money before you get a big payday?  This money for the employees seems a little premature...

Read more here.

Given the current economic conditions, consumers are staying home to save money.  This new change in lifestyle could last for years and maybe forever... companies that cater to home entertainment are destined benefit.  Netflix, Disney, Nintendo, Sony, and even Cisco are companies that will benefit in the long term.  Don't forget about Best Buy as well... I was there last night and it was PACKED.

But these are the obvious choices... what about the home improvement companies.  If you're staying home all of the time don't you want to be comfortable?  Check out companies like Scott's Miracle Grow (SMG), Home Depot (HD), and Lowe's (LOW).  They will all benefit from consumers making small, inexpensive improvements to make their homes more pleasant.

Read more here.

"We're now in Barack Obama's world where money goes into the most inefficient parts of the economy and we're bailing everyone out," says Daviowitz, who opposes bailouts for banks and the automakers. "The bailout money is in the sewer and gone."

This outlook is based on the following main points:

• Unemployment - unemployment rates are rising into double digits... and there's millions more that are "underemployed" in jobs paying half as much as their previous.  Consumer spending accounts for about 70% of economic activity and Americans aren't spending like they used to.
• Housing - The $8 trillion negative wealth effect of housing means more Americans will default on mortgages... as well as student loans and auto loans and credit card debt and any other kind of loan they managed to get.
• Commercial Real Estate - More consumer loan defaults will hit banks and commercial real estate is also headed for a crash... remember the recent bankruptcy of General Growth Properties?  This is a huge deal.  

15.4 million homeowners are now upside down on their homes... they owe more than the home is actually worth.  This is up from 13.6 million only four months ago.  The number will probably hit at least 20 million by the time this is all over. 

Read more here.

Ford Motor Co. (F) has a very creative story about how debt will be restructured and breakeven or profibility is coming in 2011.  If you believe this then tell the Easter Bunny "Hi" for me.  Ford is still operating without government aid, but they aren't selling any cars and won't be for the foreseeable future.  Even Toyota is struggling and losing money... You know what that means for Ford... Take a ride in your F-150 all the way to zero.  There's a better four-letter word that starts with F to describe the situation.

Read more here.