A picture is worth a thousand words and the below chart fits that mantra. As Argus Research notes in the chart, courtesy of Charles Schwab & Co. (SCHW), the unemployment rate is often referred to as a lagging economic indicator. As such, it tends to peak after the market has already begun to recover.
(click on chart for larger image)
Unemployment & Stock Returns ($)
Market Watch-Argus Research
September 8, 2008