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Post by unlawflcombatnt on Aug 16, 2007 12:54:06 GMT -6
from Yahoo News: Fed Injects $17 BillionBy JOE BEL BRUNO, AP Business Writer 8/16/07 -- 11 AM Pacific Tiem " Wall Street plunged again Thursday, extending an almost relentless downward spiral after problems at Countrywide Financial Corp. confirmed investors' fears that credit problems are spreading. The market shrugged off the Federal Reserve's injection of $17 billion into the banking system, and the Dow Jones industrial average fell almost 200 points.
Investors' confidence, already diminished by months of bad news about mortgages and credit, took a further pummeling after Countrywide, the nation's largest mortgage lender, said it was forced to draw on an $11.5 billion credit line to fund operations.
The Dow's tumble, which at one point was more than 343 points, pulled the blue chip index into what's known on Wall Street as a correction, a 10 percent drop in stock prices from their highs. Since the Dow reached a closing high of 14,000.41 on July 19, it has fallen 1,328 points.
The market seemed unfazed as the New York Fed...announced an overnight repurchase agreement worth $12 billion. This was on top of a 14-day "repo" worth $5 billion announced before the market opened...."
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Post by jeffolie on Aug 16, 2007 13:26:56 GMT -6
There are 'disruptions' in the commercial paper market sending the fed funds rate higher. The fed injected money directly to lower the rate back to 5.25%.
The negative markets mean injecting money has merely modest effects on the markets.
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