Can we see the bottom from here?

Traders work on the floor of the New York Stock Exchange moments after the opening bell December 12, 2008 in New York City.

TEXT OF INTERVIEW

KAI RYSSDAL: Here's the thing about this week. You take the near-death of Detroit out of the equation and it's been more normal than things have been in a long time.

For our Weekly Wrap of what's been happening on Wall Street and beyond we've got Andy Brooks with us. He's the chief trader at T. Rowe Price. And Leigh Gallagher at Fortune magazine.

Hi guys.

LEIGH GALLAGHER: Hi, Kai.

ANDY BROOKS: Hi, Kai.

RYSSDAL: Andy, I'm going to start with you and I'm going to be a little bit leading here. I'm going to ask you whether there's any sensibility of a bottom, given what's been going on this week?

BROOKS: As you know I tend to be optimistic, so I think I can answer your question. You know, either we're seeing the calm before the storm or the market really is bottoming. And . . .

RYSSDAL: All right, wait a second. You mean we haven't just had that big storm the last two months?

BROOKS: We've had about a 20 percent rally off the bottom, if you will. So there's been a pretty good market in the last couple weeks. But we're starting to see bad news that gets to the market and is not being terribly received. And by that I mean the market's not selling off in a big way when bad news is announced. And today we had some bad news about a big hedge fund that was blown up and the markets for the most part had a pretty good session.

RYSSDAL: Leigh, let me take you back farther in the week to Monday which came, obviously, after last Saturday and Sunday, which is when the president-elect announced that big stimulus package that he wants to get through. Did that sort of start things off on a good foot?

GALLAGHER: I think that definitely set the tone and we definitely saw the results of that earlier in the week. You know, the market right now is so incredibly sensitive and incredibly emotional. And things like that are really going to have an impact. So, I think you need to bear that in mind.

RYSSDAL: Leigh, let me ask you about the credit market, since that's, in theory anyway, how we got into this whole mess and it's arguably a better indictor of where we are. Things are actually getting better there, too, aren't they?

GALLAGHER: Well, they are if you look at the parts where the Fed or some other agency has intervened. Banks are still not lending the way that they ideally would be lending. And, there are still quite a few problems in the credit market. And I think that's going to take quite a bit to unwind. And, you know, I'm not so sure we're near the bottom with the stock market. I mean, I think that there's a feeling out there that the risk is greater to be out of the market than to be in it. But that doesn't mean we're not going to go down from here.

RYSSDAL: Andy, talk to me about some of those risks that still exist in the market. The one I can think of is unrealized losses that the banks are going to have to declare sooner or later.

BROOKS: Yeah and, you know, when you see somebody take a charge to reflect a loss, that means everybody else has got to re-mark their portfolios. So there's still . . . I agree with Leigh, I think there's substantial risks. And the credit markets, though they're improving, they're still pretty frozen in some ways. And the Treasury sold T-bills this week with a zero-percent interest. So, at some point you wonder when even prudent investors are going to start to say, "I gotta step out a little bit here and increase my risk profile and start to earn something that can fight inflation and give me a decent return." And until we see those spreads start to narrow, I think we're still struggling. But there've been some pretty good moves here off the bottom, and when you get good news like what Mr. Obama suggested on infrastructure spend, stocks can really fly.

RYSSDAL: Leigh, I want to pick up on something that we talked about earlier in the broadcast. You know, consumer sentiment did tick up this past month. Can we draw anything from that?

GALLAGHER: I think you can draw a little bit from that. Sales after Thanksgiving, the Black Friday sales, were better than most people expected them to be. But I do think that there is still this sense of fear, especially when it comes to consumer spending as more and more blue-chip companies are laying people off by the thousands still -- and we may see more of that.

RYSSDAL: Assuming, though, that things are relatively quiet, news-wise, for the next two weeks -- which I know is sometimes an assumption -- where do we stand as we look into the New Year. Andy?

BROOKS: All the tax-loss selling that's been going on and deleveraging and hedge fund unwinding, all that stuff, ought to be behind us. And then maybe we'll start looking forward to, you know, turning the page. And I think everybody, from Main Street to Wall Street, can't wait to turn the page and get into 2009.

RYSSDAL: Yeah, there's no doubt that we're all sick and tired of 2008, Leigh. But do you think it's actually going to change in the short-term in 2009, or are we going to be dealing with this for a while?

GALLAGHER: Well, I think Andy's right. I think that that sentiment, there's something to that. You know, we say in our investor guide this year that after a bear market, whenever the bottom is, it tends to come back very quickly in big surges. So, you know, people aren't going to want to miss that.

RYSSDAL: Let me see if I can frame it this way. We are closer to the end than we are to the beginning, right?

GALLAGHER: Let's hope so.

RYSSDAL: Leigh Gallagher at Fortune magazine. Andy Brooks at T. Rowe Price. Thanks, guys.

GALLAGHER: Thanks, Kai.

BROOKS: My pleasure. Thank you, Kai.

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