The world didn’t end on Friday, what happened today?
I would like to read the bill before anyone votes on it, how about you ??
Two things.
First, the market is bullish on the news that the House Republicans are beginning to cave and want language inserted into the bill where Paulson would "consider" their options.
The market is bullish because the investment banks know that toxic debt can be taken off of their books and put onto the backs of the taxpayers.
Secondly, the credit lending facilities tightened even further and illiquidity is rampant.
After this bill passes, we will see 3 to 5 days of market euphoria. The Dow will shoot up and all will be right with the world.
The following week, you will begin to see the credit markets tighten again, when they finally come to the realization that the Congressional bill didn't solve anything having to do with the real problem.
One more thing - the $700 billion (or whatever size 'bucket' they agree on) is simplay a "pipe". Paulson will use it to launder trillions and trillions of bad debt, by dividing each $700 billion into $50 billion dollar tranches and selling them to the bond market as 'Aaa' paper.
I have a question. When they say “Still, the Dow Jones industrials rose 121 points for the day as investors anticipated a weekend agreement.” how do they know a pending agreement is the reason for the rise? How do they know it wasn’t the breakdown of the bailout talks?
I just wonder if they talk to those in the know or if there is really no basis for that kind of speculation.I am seeing more and more of this type of comment in the “news”.
Also of note, even with Wa mu collapsing and being picked up by JP Morgan Chase, the market closed UP 126 POINTS!