Friday's employment report was, not surprisingly, worse than expected. But it had little impact because -- despite the fact that estimates were for losses of around 540,00 jobs --people were mentally prepared for something a fair bit worse. As far as the economy goes, it's quite likely that we'll see further deterioration (though it's also quite likely that somewhere along the way, we could see a few months of things getting a bit better than they just were). And, if we get a stock market rally that lasts for more than 3 days, that too will tend to buoy people's hopes.

A Path Muddied by Moving Parts

It's quite possible that such a rally is under way, as Friday's employment report (as I just noted) didn't cause the market to get smashed. Though, of course, it's also possible that the rally of the past couple days has been in anticipation of what the government produces this week (in terms of stimulus and the "bad bank solution"), and that once we get that news, the market will head straight south. It doesn't quite feel like that's about to happen, but one never knows. The good news is, we'll find out soon enough.

A Roadmap Gets an Update

In terms of my 3-baseball-game roadmap, it continues to look like this phase of the financial crisis was indeed in the ninth inning, though it could easily be argued that perhaps it went an extra inning or 2. But I think the financial crisis, for now, has been pretty well arrested.

This doesn't meant that problems originating from the economic ballgame or the future funding game won't impact financials yet again, or that there won't be more problems down the road. But the ability of the financials to single-handedly implode the tape seems to have really waned.

As for the economic-crisis ballgame, I think it's still in its early innings. But I think the majority of Americans expect that somehow the economic crisis is not going to last beyond 2009. The fact that it's been underway as long as it has makes people want to believe that it will come to an end sometime this year, which I suspect will not be the case.

Turning to the funding crisis, it appears that that game is now at least on the calendar. Rates on longer-dated Treasuries seem to have made their lows. Or, said differently, the bond market appears to have topped. However, I don't believe that the funding-crisis game can start to begin in any serious way until there is a real problem with the dollar. And for now, the dollar appears to be the one-eyed piece of paper in the land of blind confetti.

In any case, all of that is subject to change - but that's how my roadmap looks at this point.