Oct. 10--Wall Street extended its downward slide on Thursday with the Dow Jones industrials plummeting 679 points to well below 9,000.

The decline brought the Blue Chip index down to 8,579 -- its lowest level in five years -- in a drop that was fueled by tight credit markets, uncertainty over government actions to bolster the economy and a sharp decline in shares of General Motors.

Thursday's performance offered a sobering contrast to the market conditions of a year ago, when the Dow hit its all-time high of 14,198 on Oct. 9, 2007.

"Psychologically, now is a tough time for any investor, whether you're invested in a company-sponsored profit-sharing plan or a mutual fund," said Nancy D. Sidhu, vice president and senior economist with the Los Angeles County Economic Development Corp.

"All of these companies have to do reports every quarter ... and the new ones aren't going to be pretty," she said.

Standard & Poor's Ratings Services put GM and its finance affiliate GMAC LLC under review to see if its rating should be cut.

GM has been struggling with weak car sales in North America.

The action means there's a 50 percent chance that S&P will lower GM's and GMAC's ratings in the next three months.

S&P also put Ford Motor Co. on credit watch negative. The ratings agency said GM and Ford have adequate liquidity now, but that could change in 2009.

Sidhu said the auto industry is especially vulnerable to the credit crunch.

"If an industry requires borrowing money it's at risk, and the auto industry does," she said. "Most individuals who buy cars and light trucks buy them on time. And the availability of that money is coming down."

Auto dealers also need to borrow money to finance their inventories, Sidhu said.

Christopher Thornberg, an economist with Beacon Economics, said GM was already hurting.

"GM was on precarious footing anyway, and now they are facing the mother of all economic pullbacks," he said. "The whole thing is a total mess."

Financial experts have dickered over whether the nation is or isn't in a recession, but Thornberg says we're already there.

"Give me a break -- unemployment in California has gone up 2.2 percentage points in a year," he said. "That's a recession. In the end, the economy is made up of people. And unemployment is the primary measure that defines a recession."

Figures released last month from the state Employment Development Department reveal that California's unemployment rate for August was 7.7 percent, up from 5.5 percent in August 2007.