http://news.yahoo.com/s/ap/20081006/ap_on_bi_st_ma_re/wall_street

Wall Street tumbles amid global sell-off

By JOE BEL BRUNO, AP Business Writer 1 minute ago

NEW YORK - Wall Street tumbled Monday, joining a selloff around the world as fears grew that the financial crisis will cascade through economies globally despite bailout efforts by the U.S. and other governments. The Dow Jones industrials skidded more than 300 points and fell below 10,000 for the first time in four years, while the credit markets remained under strain.
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The markets have come to the sobering realization that the Bush administration's $700 billion rescue plan won't work quickly to unfreeze the credit markets, and that many banks are still having difficulty gaining access to cash.

Over the weekend, governments across Europe rushed to prop up failing banks. The German government and financial industry agreed on a $68 billion bailout for commercial-property lender Hypo Real Estate Holding AG, while France's BNP Paribas agreed to acquire a 75 percent stake in Fortis's Belgium bank after a government rescue failed.

The governments of Germany, Ireland and Greece also said they would guarantee bank deposits.

The Federal Reserve also took fresh steps to help ease seized-up credit markets. The central bank said Monday it will begin paying interest on commercial banks' reserves and will expand its loan program to squeezed banks.

Investors took a bleak view of the future, seeing no end to the crisis in the near term. But analysts were more optimistic.

"These programs are going to be effective I believe," said Rob Lutts, chief investment officer at Cabot Money Management. "Shorter term we're in a very challenging environment that's going to take a while."

In the first hour of trading, the Dow Jones industrial average fell 311.26, or 3.01 percent, to 10,014.12 after falling to 9,981.39, its first drop below 10,000 since Oct. 29, 2004.

Broader indexes also tumbled. The Standard & Poor's 500 index shed 40.92, or 3.72 percent, to 1,058.31; and the Nasdaq composite index fell 74.01, or 3.80 percent, to 1,873.38. The Russell 2000 index of smaller companies dropped 23.43, or 3.78 percent, to 595.97.

In Asia, the Nikkei 225 closed 4.25 percent lower. Europe's stock markets also declined, with the FTSE-100 down 3.24 percent, Germany's DAX down 5.28 percent, and France's CAC-40 down 5.60 percent.

The anxiety was again obvious in the credit markets. The yield on the three-month Treasury bill slipped to 0.38 percent from 0.50 percent late Friday. Demand for bills remains high because of their safety; investors are willing to take extremely low returns just to have their money in a secure place.

Investors also moved into longer-term Treasury bonds. The yield on the 10-year note fell to 3.52 percent from 3.60 percent late Friday.

Banks' hesitation to lend to one another and to many businesses and individuals is the result of the bad mortgage debt that the government's financial rescue is supposed to sweep up. But it's still unclear how quickly financial institutions will be able to hand that debt over and convince the markets they are healthy again.

There has been some hope that perhaps the Fed, in concert with other central banks, might cut interest rates to help stimulate the economy. With oil prices well off their midsummer highs and indicators pointing to a slower economy, the Fed's worries about inflation are less than they had been, making it easier to justify a rate cut.

Investors might get some indication about a potential rate cut with several policymakers slated to speak this week. Dallas Fed President Richard Fisher and Chicago Fed President Charles Evans will speak on the U.S. economy on Monday. Federal Reserve Chairman Ben Bernanke is due to speak on Tuesday.

Frederick Dickson, chief market strategist at D.A. Davidson & Co., believes investors are eager for any signs about the well being of the economy.

"Wall Street at this point is shifting its attention from whether Congress was going to act on the emergency stabilization bill to the realization that the economy is slowing significantly faster than most analysts had expected," he said. "The downturn has shifted from first gear to about third gear in about two weeks."

Meanwhile, oil prices fell to an eight-month low below $90 a barrel on speculation that the spreading financial crisis will exacerbate a global economic slowdown and further cut demand for crude oil. Light, sweet crude tumbled $3.82 to $90.06 a barrel on the New York Mercantile Exchange.

The dollar rose to a 13-month high against the euro, and was also higher against other major currencies.

In corporate news, ailing Hartford Financial Services Group Inc. received a $2.5 billion investment from European insurer Allianz. Hartford's market value was halved last week on concerns it needed more capital to survive, but shares recovered $4.53, or 16.5 percent, to $31.93 on Monday.

EBay Inc. fell $1.14, or 6 percent, to $17.81 after announcing it will cut about 1,000 jobs, reducing its work force by 10 percent, to streamline the company. The online auction site expects restructuring charges of about $70 million to $80 million, mostly during the fourth quarter.

Wells Fargo & Co. said late Sunday its takeover agreement with Wachovia Corp. will go forward after a state appeals court blocked a lower court ruling that favored rival bidder Citigroup Inc. Wells Fargo said it will "continue working toward the completion of its firm, binding merger agreement" with Wachovia.

Shares of Wells Fargo rose 6 cents to $34.68, while Citi fell 64 cents, or 3.5 percent, to $17.78. Wachovia fell 18 cents, or 2.9 percent, to $6.03.

Eli Lilly & Co. said its board approved an acquisition of ImClone Systems Inc. for more than $6 billion. The deal, which also has been approved by ImClone's board, will create one of the leading oncology franchises in the biopharmaceutical industry. Eli Lilly fell $1.53, or 3.7 percent, to $39.75, while ImClone surged $2.80, or 4.3 percent, to $67.75.

Wow down 570 points right now.  :o  :-\\

yippee! we're all gonna die.

yippee! we're all gonna die.


I can't afford to die!  :D

Yep...and today it closed below ten grand for the first time in four years. :-\\




yippee! we're all gonna die.

Does sorta seem like it, lol

I wouldn't worry yet, Jeff.  It wasn't that long ago that the Dow was normally around 2500.  I only worry for those close to retirement with their accounts in the market.  Those of us who have a while should be able to ride it out.  Yeah, the value will go down but it is all on paper.  It will get better again. 

Yeah, the glass is almost always half full with me. :D

I wouldn't worry yet, Jeff.  It wasn't that long ago that the Dow was normally around 2500.  I only worry for those close to retirement with their accounts in the market.  Those of us who have a while should be able to ride it out.  Yeah, the value will go down but it is all on paper.  It will get better again. 

Yeah, the glass is almost always half full with me. :D


I'm not retiring, but I am using an investment to pay for my addition on my house.  Not sure how to cover the difference now that the fund has lost close to 50% of it's value this year.  Completely nuts.

Glad we got that bailout passed last week.  That way I get to feel it multiple times... once in the market, once in my taxes, and again when my paycheck won't buy what it used to.

I can't afford to die!  :D


That's me!

St. Peter don't you call me 'cos I can't go, I owe my soul to the company sto'!


Time to sober up folks.

I wouldn't worry yet, Jeff.  It wasn't that long ago that the Dow was normally around 2500.

And that was back in the 80's. In the early 90's it crossed the 3,000 mark and stayed past there for good by about 1992. In fact, I was keeping track of the D.J.I.A.'s progress regularly during the 90's (from about 1992-93 onward); numerical things like that always interested me.

  I only worry for those close to retirement with their accounts in the market.  Those of us who have a while should be able to ride it out.  Yeah, the value will go down but it is all on paper.  It will get better again. 

Yeah, the glass is almost always half full with me. :D

I know it will...eventually. But it'll take some time. ;)

I heard about this when Netherlands bought-out a bank. Then Europe and Asia's stocks went low.

When Europe and Asia suffers, the U.S. suffers...sadly.

And today I happened to notice it dropped another 500 points today, just about equaling the point loss of 10/19/87. :o (Percentage-wise, however, it was much lower.)

I looked into my retirement account, it isn't pretty, it is kinda scary.  :( >:(

I looked into my retirement account, it isn't pretty, it is kinda scary.   :( >:(


Just think... those very same financial wizards could have been investing your Social Security money for you, instead of our current system.  Remember the GW "personal investment account" plan?

Just think... those very same financial wizards could have been investing your Social Security money for you, instead of our current system.  Remember the GW "personal investment account" plan?


Instead of our current system which will also implode?

Although it wouldn't have prevented it, diverting a portion of current SS tax revenue from government coffers into individual accounts might have forestalled this crash by a few years.  (If you wanted to dispense with the fiction of individual accounts and mandate that the private accounts be invested in T-bills or held as at a deposit-taking bank, it actually might have prevented this problem, because it would have given the banks a nice fat cushion of capital against which they could loan.)

But now that you mention it, why hasn't anyone suggested using the "money" that's currently in the SS "trust fund" to recapitalize the banks?  (Oh, wait, that's right, because there isn't any.  When the government writes an IOU to itself, no asset actually exists.)

Sorry, Chucky, but SS is even deader than the bailout bill.  They'll do the same thing to "fulfill the promise" of Social Security that they will to "make the taxpayer whole" on the TARP toxic asset buys:  print money, issue bonds, and tax future generations to pay for current expenditures.  You'll get an SS check for $1000/month, but a can of cat food will cost $100.

Instead of our current system which will also implode?

Although it wouldn't have prevented it, diverting a portion of current SS tax revenue from government coffers into individual accounts might have forestalled this crash by a few years.  (If you wanted to dispense with the fiction of individual accounts and mandate that the private accounts be invested in T-bills or held as at a deposit-taking bank, it actually might have prevented this problem, because it would have given the banks a nice fat cushion of capital against which they could loan.)

But now that you mention it, why hasn't anyone suggested using the "money" that's currently in the SS "trust fund" to recapitalize the banks?  (Oh, wait, that's right, because there isn't any.  When the government writes an IOU to itself, no asset actually exists.)

Sorry, Chucky, but SS is even deader than the bailout bill.  They'll do the same thing to "fulfill the promise" of Social Security that they will to "make the taxpayer whole" on the TARP toxic asset buys:  print money, issue bonds, and tax future generations to pay for current expenditures.  You'll get an SS check for $1000/month, but a can of cat food will cost $100.


You're gonna need Mr. T-bills if you want any bang for your buck. 

Yeah, invest everybody's food & rent money in the trading markets.  Real bright idea.  I'ma get me a bigass purple Cadillac with tricked-out rims and as I cruise by my sick old mother standing in the soup line, I'ma hang my Rolex encrusted wrist out the window and say, "Yo', Ma, I told you to go into soybean futures with me!"

Instead of our current system which will also implode?

Although it wouldn't have prevented it, diverting a portion of current SS tax revenue from government coffers into individual accounts might have forestalled this crash by a few years.  (If you wanted to dispense with the fiction of individual accounts and mandate that the private accounts be invested in T-bills or held as at a deposit-taking bank, it actually might have prevented this problem, because it would have given the banks a nice fat cushion of capital against which they could loan.)

But now that you mention it, why hasn't anyone suggested using the "money" that's currently in the SS "trust fund" to recapitalize the banks?  (Oh, wait, that's right, because there isn't any.  When the government writes an IOU to itself, no asset actually exists.)

Sorry, Chucky, but SS is even deader than the bailout bill.  They'll do the same thing to "fulfill the promise" of Social Security that they will to "make the taxpayer whole" on the TARP toxic asset buys:  print money, issue bonds, and tax future generations to pay for current expenditures.  You'll get an SS check for $1000/month, but a can of cat food will cost $100.


Where do you think the money to invest in the t-bills was going to come from?  That money would have had to come out of the current tax system.  If anything it would have cause the soon alot sooner and a lot harder.  A cushion to loan from?  Don't make me laugh.  They'd have tapped every cent they could touch long before a crisis became visible.

The Dow has now just fallen below 9,000 this afternoon.  :o

The Dow has now just fallen below 9,000 this afternoon.  :o

oh dear!! :o :o

When was it last at that level? I would venture to guess sometime around 2003/04.

close to 8500 now. and yeah, 2003 is the last time.

GM shares are apparently at their lowest level since 1950!, which they're saying was one of the triggers of today's 678 point drop.

http://biz.yahoo.com/rb/081009/business_us_gm_shares.html

GM shares are apparently at their lowest level since 1950!that's because SUV=DUH.

Two weeks ago, an economist said the DOWN Jones Industrial Average was going to go down to 8000.  I think alot of people couldnt beleive it.

The Fed must break out the Japan-esque 0% rate to get money moving again.  Until then, it may be a slaughter.

Once again, Reaganomics is outta gas!  It's over.  Time to try something different!
::)

that's because SUV=DUH.

LOL O0 :D


Two weeks ago, an economist said the DOWN Jones Industrial Average was going to go down to 8000.  I think alot of people couldnt beleive it.

The Fed must break out the Japan-esque 0% rate to get money moving again.  Until then, it may be a slaughter.


Looks like their predictions are about to come true, sadly. :-\\

Where do you think the money to invest in the t-bills was going to come from?  That money would have had to come out of the current tax system.  If anything it would have cause the soon alot sooner and a lot harder.  A cushion to loan from?  Don't make me laugh.  They'd have tapped every cent they could touch long before a crisis became visible.


Actually, it would have been later -- but with a few caveats.

First off, can we agree that any version of private SS accounts amounts to "forced savings"?

If those accounts had been accounts able to invest in any publicly-traded security (stock, bond, or mutual fund) at the sole discretion of the accountholder, I believe that a privatized SS would have delayed the current debacle, as some of those funds would have been invested in bank (primary or secondary offerings), and some of them would have been invested in bank money market funds, and all of that money would have shored up balance sheets.

If those accounts had been invested in T-bills (and only T-bills) by government mandate, however, you're absolutely correct -- there'd be no economic difference between such a plan and the ponzi scheme currently in force.  That's one of the reasons the 2004/5 privatization option fell flat on their face before even being presented to Congress.  Even I wouldn't have invested in such a scheme; all the trial balloons floated by the administration had too many strings attached to the funds to make it worth investing in, especially since we were only talking about a third (2.1% of 6.3%) of the employee's half of the 12.6% SS tax.

All water under the bridge, now, because we're at the stage where throwing multiple trillions of dollars at the problem won't staunch the flow of red ink.  As I suggested in another thread, it's too late for anyone to do anything about it now.  Come to the fifth stage - acceptance.  I had a good ten years compared to most Americans.  I had a fantastic life compared to most of the rest of the world.  If the cities burn, so be it.  We all had a pretty good run.

Dow Futures at -166, up from -250 a couple of hours ago, so if we're lucky, we might survive Friday. 

If we're very lucky and things go well during the summit meetings, (and I reiterate that hope is not an investment strategy), we open down 10-20% on Monday, and we never look back.  By Monday night, we might not have TCP/IP connectivity, so I'll post this while I can:

http://img368.imageshack.us/img368/6420/tradeinhellqk9.jpg

Me?  I would have preferred Arby's, but odds are that by Monday night, we all trade in hell.

I checked my mutual funds retirement account.  I've lost about 20%.

http://img368.imageshack.us/img368/6420/tradeinhellqk9.jpg

i like how they picked a trader with a pink shirt.

How much money can you store under the mattress?

I checked my mutual funds retirement account.  I've lost about 20%.


I wish I only lost that much.... oh how I wish....

As Professor Zimmerman said,

"When you ain't got nothing, you got nothing to lose!"

;)

Social Security might be "forced savings," but I'd rather that than more cold, hungry grandmothers. 

Maybe if we return to sane revenue policies, we won't have to raid the SS trust fund.
::)

I told my father to get his money out of the market months ago, and he told me that he pays someone to take care of his money that knows much more about financial matters than I do. I haven't actually asked about it recently, but hopefully this advisor knows what they're doing like he said and not too much more money was lost. As for myself, my expenses currently exceed my income and it isn't getting any easier to change that.

And yesterday's plummet came 1 year to the day after the DJIA's all-time peak of 14,000+, according to what I saw in the newspaper this morning.


And I saw on the news this morning that it was going down even more today. :o

I wonder if I should buy up WaMu stock before it gets taken over.

I wonder if I should buy up WaMu stock before it gets taken over.


Wouldn't a takeover make the stock worthless?

Wouldn't a takeover make the stock worthless?


No, the stocks would become payable in the name of the new owner. 

Luckily, I didn't put Stocks in anything, otherwise I would do this....http://www.donald.org/DD/bilder/DD090-gross.jpg(This is NOT pr0n, and even though It's in German, some people may wind-up doing this.)

http://nyulocal.com/city/2008/10/10/wall-street-bull-the-victim-of-hilarious-vandalism/

http://nyulocal.com/city/2008/10/10/wall-street-bull-the-victim-of-hilarious-vandalism/


That pic is made of GOD and WIN.

It's also pretty appropriate choice of vandalism; the bull is denied release by the strictures of tight LIBOR rates.

Next week, I hope that some similarly enterprising vandal will remind the world that the proximate cause of our problem could also be described as a constipated interbank lending system...