ONE YEAR AFTER, David Kelly, Chief Market Strategist, JPMorgan Funds 

This week marks the one-year anniversary of the stock market low and plenty of airtime and newsprint will be devoted to the impressive rally in the market since then. However, it is impossible to look at the economic numbers without reflecting on how far the economy and markets still have to travel before returning to normal.     A barrage of numbers on the job market last week confirm that we are essentially at the end of payroll job losses. However, with U.S. payroll employment now down more than 8.4 million jobs in the last 26 months it will take many years to get back to pre-recession employment levels, even in a best-case scenario.   Numbers due out this week should tell a similar tale. Initial unemployment claims have been coming down in recent months but are still running at more than 450,000 per week, compared to the 320,000 per week average seen from 2005 to 2007.   U.S. exports are likely to have risen for the ninth consecutive month in January but they still remain about 12% below their peak in the summer of 2008, while imports are 20% below their July 2008 peak.   Thursday will also see the release of quarterly flow of funds statistics with household net worth likely rising by over $1 trillion to $54.5 trillion in the fourth quarter of last year. However, while this would be up about $6 trillion from its 2009 first quarter low, it would still mean that households have only recovered one third of the $18 trillion decline in net worth produced by the crashes in the real estate and equity markets.   Finally, as of this morning, although the S&P500 is up 68% from its March 9th, 2009 low, it still needs a gain of 37% just to get back to its peak of October 2007.   However, while all of these distances are long, the economy does appear to have the potential to get most of these numbers back to their old highs over the next few years. If this transpires, the next few anniversaries of March 9th 2009, like the first one, should provide many happy returns for investors in U.S. stocks.  

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