|
Post by unlawflcombatnt on Apr 18, 2011 22:32:54 GMT -6
from Market Watch Stocks drop most in month on S&P moveMon, Apr 18, 2011 by Kate Gibson " U.S. stocks suffered their worst selloff in a month Monday after Standard & Poor’s revised its long-term outlook on the U.S. to negative from stable and as worry about Europe’s debt troubles intensified.
The Dow Jones Industrial Average (DOW:DJIA) ended down 140.24 points, or 1.1%, at 12,201.59, its worst point and percentage loss since March 16, when markets tumbled on concerns about the impact of Japan’s earthquake and tsunami....Monday’s loss represented a partial recovery from session lows, when the blue-chip index had fallen 247.94 points.
Among 30 Dow components, only Boeing Co. (NYSE:BA) rose, edging 0.3% higher. Bank of America Corp. (NYSE:BAC) led decliners with a 3.1% drop. ( Couldn't have happened to a nicer bunch of guys)
The Standard & Poor’s 500 Index (CME:INDEX:SPX) shed...1.1%....
The Standard & Poor’s action “put the debate on cutting the budget deficit and dealing with our debt problems front and center. Now it’s on Joe Six-Pack’s front page,” said Paul Nolte, managing director at Deaborn Partners.
|
|
|
Post by jeffolie on Apr 19, 2011 9:52:37 GMT -6
I have noticed that news related sharp market price drops often result in the drops being reversed within days.
For traders these news related sharp market price drops may be a short term buying tactic/opportunity. I am not a trader.
Stocks had immediately dropped 200+ points in an hour, money moved into Treasuries with 2 years or less maturities, gold/silver initially jumped.
The point is that even rating agencies with horrible histories of not correctly rating debts can and do move markets at least short term and quickly at that.
|
|
|
Post by jeffolie on Apr 19, 2011 10:11:12 GMT -6
With the new 'negative view' most likely came FED actions to temporarily strengthen the Dollar and drive down Treasury rates.
This is not a 'free market'. Politics and economics are 2 sides of the same coin. Governments act, central banks act. Long term when manipulations as blantant as Ponzi schemes by governments fail, then the time from status quo with government actions maintaining the status quo to failure can be as fast as months. Take the example of the European peripheral countries, the PIIGS, where now Greek government 2 year notes yield 20% compared to months ago when they yielded single digits. The same unsustainable high yields will happen in US Treasuries but not now because the status quo is maintained for now but like Greece the status quo will eventually fail, most likely after Republicans control the Senate, House and Presidency then impose 'austerity' which will destroy what is left of consumer spending in 2014 or beyond.
|
|
|
Post by mdub on Apr 20, 2011 18:38:19 GMT -6
I can't believe investors need a credit rating agnecy to tell them that US debt is junk. The only way the US can pay back its creditors is through inflation.
The Fed is keeping rates artificially low by buying up Teasuries....
|
|
|
Post by jeffolie on Apr 21, 2011 0:11:00 GMT -6
I have noticed that news related sharp market price drops often result in the drops being reversed within days. For traders these news related sharp market price drops may be a short term buying tactic/opportunity. I am not a trader. Stocks had immediately dropped 200+ points in an hour, money moved into Treasuries with 2 years or less maturities, gold/silver initially jumped. The point is that even rating agencies with horrible histories of not correctly rating debts can and do move markets at least short term and quickly at that. Yes, I was expecting this drop to be a buying opportunity for traders: "....I have noticed that news related sharp market price drops often result in the drops being reversed within days..."
|
|