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Bernanke talks, market tanks
October 7th, 2008, 7:45 am · 14 Comments · posted by John Gittelsohn
Updated after market close
Federal Reserve Chairman Ben Bernanke warned that the nation’s financial crisis could bring long-term pain and that the “outlook for economic growth has worsened.”
Fed Chair Ben Bernanke
The comments sent markets tumbling again, just hours after a new Fed move to grease lending and liquidity buoyed investor sentiments. The Dow closed at 9,447, down 508 points or 5.1 percent.
President Bush talked to European leaders about the global nature of the financial crisis and later tried to buck up spirits on the economy.
“We have been through tough times before and we’re going to come through this again,” the president said.
In its latest effort to restore confidence in the U.S. financial system, the Fed announced today it will undertake a radical plan to buy short-term corporate debt to get money moving in the lending system again.
Short-term corporate debt, also known as “commercial paper,” is used by non-financial companies to keep their operations going on a day-to-day basis. It is typically unsecured and unregulated by federal agencies.
“This facility should encourage investors to once again engage in term lending in the commercial paper market,” the Fed said in a statement today. “An improved commercial paper market will enhance the ability of financial intermediaries to accommodate the credit needs of businesses and households.”
To see the text of Bernanke’s speech, CLICK HERE.
Other meltdown news …
- Dow dips more than 500 on financial worries
- Bernanke: Crisis could prolong economic pain
- CNN poll: Bailout better for Wall Street than Main Street
- Fed to buy massive amounts of short-term debt
- Oil rebounds after falling to 8-month low
- Bank of America reports drop in profit
- Treasury and Fed pledge rapid response to crisis
- European, Asian markets plunge on crisis fears
- Fed says it will pay interest on banks reserves
- Official: Kashkari to be tapped to head bailout
- Bank of America settles suits over bad mortgages
- Treasury announces plan to boost debt auctions
- European, Asian markets plunge on crisis fears
What to do with your money ….
- O.C. investment experts say don’t buy yet — but get ready
- Yikes! What do I do with my money now?
- Should I bail on my 401(k)? Is my savings safe in my bank?
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14 Comments
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this guy is an idiot
Banks get rescued, insurance companies get rescued, fed buys out debt, people get rescued on their mortgages because they didn’t read or “understand” the paperwork, and so on and so on… The large corporations are getting their rescue packages, the people in lower priced homes are getting rescued, what about the rest of us who are victims of the economic situation too??? The people who have never missed a mortgage payment, but have taken an enormous hit in market value. We have a multi-million dollar home that is worth far less than we have invested in it due to market conditions. We’re stuck with two homes now and can’t get rid of either of them. And while we’re not homeless, it is still extraordinarily stressful. Where’s our bail out package for our economic pain & suffering?
The reality is that the only ones are getting “rescued” are the executive level employees that would lose everything if their companies don’t get bailed out. Everything was driven by greed, and the most greedy will get to keep everything.
The reality is that this “bailout” will do nothing.
Jenifer, those of us like you and me who have never been late on a mortgage payment are the suckers. I suppose we should have known the country embraces and rewards fiscal irresponsibility.
I won’t be able to retire until age 90 now
Hmmm, maybe this is why Greenspan was known for his cryptic speech, so he wouldn’t send the markets into a tailspin. Oh, and that trillion dollars…thanks for nuthin’ except new debt.
When it absolutely, positively has to be screwed up overnight…just call on the Fed.
AMERICAN WILL NEVER LEARN ANYTHING FROM THIS DEBACLE.
THE NEXT BUBBLE HERE WILL BE ANOTHER ONE BUILT ON A HOUSE OF CARDS.
I don’t know where you folks get your information. The bailout bill had nothing to do with the people on ‘main street’. It was a bailout package for the Wall Street crooks and foreign bankers. It was purported to stabilize the markets and protect your 401-k’s. Nothing was further from the truth. All of you have been conned. The politicians were simply protecting their sugar daddies on Wall Street. And since they approved this scam last Friday the market has lost over $2 TRILLION in capitalization. It sure stabilized the market, eh? And the calls going into their office were 90 to 1 opposed to the bailout. But in their arrogance they shook their fingers at you and told you that you aren’t sophisticated enough to understand. So they stole you money and thwarted your will in one afternoon. All you have left is the power of your vote. Vote all the scoundrels who voted for the bailout out of office!
I am domingo and I approve ocobserver’s message!
Six to a month ago we knew things weren’t great and most believed we were in a resession, Duh. The leaders would explain that markets were stable and we were not headed into any ressession. Now it is explained that we are to expect a mild recession. If that is true we have to expect the information we get from Washington D.C. is caculated using the following formula. Current Washington info X 10 = Serious Depression. Be safe, plan for it.
As that noted economist John McCain said recently “the fundamentals of the economy are sound.” He may win the Herbert Hoover Prize for that comment.
Despite my own trepidation, I checked my 401K and IRA today and I’ve lost over $7,000 in the past three months since I was laid off/forced to retire. Find me a higher porch than I have to jump off!
DJIA is down nearly 1,700 points in the past 7 days. I hope no one was planning on retiring any time soon.
This is exactly why the Federal Reserve was created. Expand the money supply to build faux growth then pull the rug out so certain banking insiders can snap up the bargains. This never happened while we were on the gold standard. Support Ron Paul’s HR 2755 to abolish the Federal Reserve. While were at it, HR 1146 will restore American soverignity by getting us out of the UN.