Attitudes

It is a remarkable reversal in attitudes from just a few months ago, when the broader economy seemed relatively healthy but Wall Street was traumatized by billions of dollars in mortgage - related losses. Now, bankers and investors appear ready to look past the crisis to more profitable times, while consumers find themselves in a more precarious position as the job market weakens and banks make it harder to borrow money. It is, of course, not uncommon for Wall Street to run ahead of the broader economy. Investors, after all, make money by anticipating the future. The job market, by contrast, improves more slowly than other aspects of the economy. But specialists say the two sides will eventually converge. Either the markets will give up their recent gains or, if the optimists are right, the broader economy will show greater strength as tax rebate checks and lower interest rates stimulate the economy. There have been false dawns before. Last spring, after several mortgage companies collapsed , Mr. Paulson and the chairman of the Federal Reserve, Ben S. Bernanke, said the problems appeared to be "contained." In early October, just two months after credit markets froze up, the stock market climbed to an all-time high. The optimists believe it is different this time. The catalyst for the change, they say, was the Fed-arranged deal that sold a troubled investment bank.