this crisis is a lot of STOCK MARKET BULL SHEET.
Today the DOW has gone down from around 14,000 to 11,000. 3k. Around 21 percent. From Oct. 2007 to present.
Consider that in the 2000 - 2002 time span the market lost 36 percent. Included in this was the worst terrorist attack in US history.
From around 11,700 to 7,800. 4k.
It was much worse then and we didn’t have the Government freaking out and handing out almost a trillion bucks and taking on more trillions worth of loans.
But this time its during a Presidential Election!
....this time the congress is controlled by democrats
....this time the ability to short stocks is much greater because the democrats got rid of the UPTICK RULE....
- it required that a short sale be made only at a price “higher than the last different price.” In other words, you couldn’t short a stock unless it first ticked up an eighth- or a quarter-point.
Thursday - short selling of financial stocks has been banned in Britain
If before
the DOW dropped 36 percent from 11000 and we survived,
.. yet now we drop 21 percent from 14000 and we are worse off?
There has been a real attempt this week to destroy some of the financial bastions of the economy. There was starting to be talk of CD's being less than they were bought for, FDIC not able to cover bank accounts, etc. And the shorts were making it seem like these stocks were going down on valuation, instead of just plain abusing short trading. Runs on banks could have been one of the next steps if the Gov't was seen to be standing idly by.
We're not out of the woods yet, but we're starting to address the meat and potatoes of the problems now. Thank God.