the dow dropped more than 500 points…more than 20 points in less than 30 seconds.
a perfect storm of bad news, including a drop in chinese stocks, a drop in durable goods sales by 8%, and continuing lower prices in the housing market, made for a maalox moment on the trading floor today.
— more —
ironically, consumer confidence crept up to a 5 year high. but as was heard in skippy international headquarters today: “not any more.”
as of this writing the dow has snuck back up to a mere 430 closed at 400 points in the hole. still and all, a 4% drop is nothing to sneeze at.
addendum: we’re listening to cnbc tv, where the anchors are warning that this very well could be not the last of the selling, ie, more bad news tomorrow, and maybe for up to 5 days!
in the Chinese Market:
uh oh
march on the pentagon: 3.17.07
Draft Al Gore: 2008
The market has gone more and more electronic. This sort of thing COULD NOT have happened 3 years ago – they couldn’t execute the orders fast enough.
We need a market with a brake, not one with the mindless sheeple who run most merchant banks able to do moronic things without any judgement whatsoever.
The Dow Jones Industrials Index dropped at the rate you cite, but only because the clowns at Dow Jones had installed a new shiny index calculation system that couldn’t keep up with a market like today’s, and when they finally decided to cut back to their old, fast system just before 3:00 today, their Dow calculations suddenly caught up in the space of minutes, making it appear that stock prices actually fell that far that fast.
They didn’t, and I doubt they could. The “market” (which is really way too grand a term for the 30 lousy companies in the Dow Industrials) was down 500 points well before 3:00… but thanks to Dow Jones, nobody knew it.
to have a Depression?
We’re 8 or 9 trillion in debt, don’t save squat, are sitting on a huge bubble of housing, don’t make anything here any more, and inequality (measured by the Gini index of income inequality) is at a level not seen since 1932.
Would it be a surprise if America’s bubble really bursts? Who in the world would weep? We’ve pissed off even the Brits.
One difference this time around is that the US will be without surpluses in natural resources that it had during the last economic depression. Oil & natural gas? Don’t count on ’em. Suburbs & exurbs? The exodus from them will look like a replay of the dustbowl era. Maybe we have enough of a railroad infrastructure left that could be refurbished – and that would at least provide some jobs, and a means of transport as the ability to import oil becomes reduced. Manufacturing? Do we actually build anything any more? (yeah, I know, hyperbole alert) I could go on.
I get the impression that this next crash will be one for the long haul.
No a depression reminiscent of the thirties would not be a shock. But the lack of food stocks will be a shock to all, even the rural population.
In the depression of the thirties, at least the rural areas had food stocks; chickens, hogs, beef, veggies, fruit, which was either live out in the shed, or canned and stored in the cellar.
Now rural midwest folk hardly even have gardens let alone do any canning. The grandsons and granddaughters of the pioneers buy all that in the city.
What the midwest farmers are likely to have available (keep in mind availability may be seasonal) for the hungry masses are commodities such as corn, wheat, barley, various beans, and for oils; flax,sunflowers,canola.
You might want to experiment now with some recipes so as to acquaint yourselves with the use of the above in their in-the-bin forms.
You’re right that a bunch of us (my family included) have a great deal of re-learning ahead of us.
The market closed down 416 points, with more sell orders than buy. The clouds have been forming for the last 3 years while we’ve been distracted by blonds and runaway brides.
Tip of the iceberg as several mortgage companies have declared bankruptcy or closed their doors – at least 20 affecting some of the world’s largest financial institutions, in short one or 3 banks near you. And we have not included the trillions in derivates.
The Chinese market was the trigger so they say.. But imho, their trigger came when Alan Greenspan blew cold on the Goldilocks’ porridge.. erm..market yesterday, saying a recession was in the works for end of this year.
Then investors saw the pile on -that the game is over –Freddie Mac refuses to be the lender of last resort – the bust is here as broader market is under threat.
and that’s before the Resets ARMs (adjustable rate mortgages) due later this year.
Economic and Financial Hard Landing Ahead
Some biggies will need to be rescued.
Put on your hemlets. buckle up.