"Signs of rally snuffed out as Dow drops; Stocks lose earlier gains as economic outlook worsens" by Robert Weisman, Globe Staff | October 16, 2008
The battered Dow Jones industrial average yesterday suffered its second-largest one-day point drop to date, giving up the lion's share of the gains from its 936-point rally on Monday amid fresh signs of weakening in the New England and national economies.
The Dow resumed its October nosedive, tumbling 733.08 points, or 7.87 percent, to 8,577.91 after a dismal report on national retail sales. The market rout raised concerns that Monday's historic gain may have been a "dead-cat bounce," a rally with no life, and stocks are heading lower.
Yesterday morning's Commerce Department report showed the biggest falloff in retail sales in years , down 1.2 percent. It was followed by the release of the Federal Reserve's Beige Book, which confirmed that steps to unclog credit markets haven't halted a slide in the broader economy.
Sigh. Not meant to be unclogged (part of the plan):
U.S. Banks Driving Credit Crunch ON PURPOSE!!
America Never Had a Chance
Seeking to reassure investors, Federal Reserve chairman Ben S. Bernanke told the Economic Club of New York yesterday the financial rescue plan that has taken shape over the past few days, including the injection of $250 billion into US banks, will need time to work. Even when credit begins flowing again, "broader economic recovery will not happen right away," Bernanke acknowledged.
Then why the rush to get the damn bailout through?
Last month's retail pullback underscored dimmer prospects for staples ranging from consumer electronics to home furnishings. The Beige Book, meanwhile, pointed to weaknesses in every one of the dozen Federal Reserve districts across the United States. Oil prices also skidded on recession fears yesterday, with crude oil trading below $75 per barrel, its lowest level since August 2007.
How come no drop at the pump?
Some investment professionals pointed to signs the stock market may be bottoming out, while others said it could fall further. --more--"
Translation: We don't know! And per Globe policy, the rest of the commentary is "leave your money in, it's all gonna get better" spin.
