The Hussman Funds founder, John P. Hussman, Ph.D., has an article on the funds’ website about the current stock market. Its title is How Low, How Bad, How Long?

This interesting article was brought to my attention by the Investment Quality Trends newsletter.

The article gives you lots of numbers to ponder to describe the assumptions that are safe to make about the market’s future without predicting exactly any of the elements in the title.

The other topic that I found interesting in this article was the last paragraph about how to and how not to handle the home mortgage foreclosure crisis.  This paragraph discusses an idea similar to what I described in a previous post, Greenberg et. al. Solution to Real Estate Bubble.

The following sentence is from Hussman’s article:

Any solution that provides for a reduction in mortgage principal, without tying that reduction to some amount of surrender of future property appreciation – will immediately encourage mass delinquencies and foreclosures, as homeowners compete for what would, in effect, be free money.

I suppose this post could have been made in my Investing Forum, but I thought it of enough general interest to post here.