Investors pull $47bn out of equity mutual funds
FEDERAL PONZI SCHEME - Papering Over The Debt
Wobbling
"Compounding the gloom are the revisions made by government statisticians to earlier figures. It now turns out that last year’s recession was significantly worse than previously estimated, and growth in the first three months of 2002 a bit less impressive than earlier statistics had indicated. The backward changes will mean a downward revision to America's spectacular productivity figures and cast further doubt on the “miracle” of the new economy.
The new figures are a blow to hopes that America’s economic recovery is well established. Suddenly, the recovery looks weak and the economy looks vulnerable to further shocks."
Fear of 'jobless recovery' spreads
PGS PGS.OL seen plunging after merger collapse
US Senate Concludes Business, Begins Recess
5,000 jobs at Siemens may be cut
Weak Jobs Data Pressures Dollar
Japan Land Prices Fall for 10th Year
Uruguay police deployed to deter looting amid bank closures
"Another way to make sure that we foster growth and restore confidence is to hold people accountable for misdeeds in the public sector."
George W. Bush - University of Alabama at Birmingham Alys Stephens Center - July 15, 2002.
NOTE: Do as I say, not as I do
Blast from the past:
PROGRAM TRADING - The 1987 Market Crash
Stock Market Suffers Largest Loss in History as Dow Industrial Average Drops 508 Points
The Washington Post
By Peter Behr and David A. Vise
Washington Post Staff Writers
Tuesday, October 20, 1987; Page A01
SOURCE
Partial Transcript:
The stock market was devastated by the worst one-day collapse in history yesterday in a pandemonium of panic selling that shattered all records and swamped stock exchanges around the country and overseas.
The best-known market barometer -- the Dow Jones average of 30 industrial stocks -- plummeted 508 points, five times the previous record set last Friday. The Dow closed at 1738, dropping 22.6 percent, or nearly double the 12.8 percent plunge of Oct. 29, 1929, the crash that began the Great Depression.
More than 604 million shares were traded on the New York Stock Exchange and 239 million on the American and over-the-counter markets, shattering previous records.
Investors lost more than $500 billion in stock market value, according to Wilshire Associates of Los Angeles, which publishes an index of some 6,000 publicly traded stocks.
And the losses were mirrored on markets around the world in a sobering demonstration of the electronic and psychological links that now tie the world's investors together.
John Phelan, chairman of the New York Stock Exchange, called the collapse a near "meltdown" caused by a "confluence" of factors: the market's inevitable turnaround after its long climb, heightened anxieties over rising interest rates and future inflation, and the impact of computerized trading maneuvers.
A remark by Securities and Exchange Commission Chairman David S. Ruder, discussing the possibility of a government-imposed halt in trading, added to the binge.
Other observers said fear was the overriding factor yesterday. "This is a financial panic," said Allen Sinai, chief economist with Shearson Lehman Brothers Inc.
"It is the classical mob psychology that takes over," said Burton Siegel, chief investment officer of Drexel Burnham Lambert Inc. "It feeds on itself. What you are dealing with here is a complete change in perception and psychology."
"This is chaos," said Neil Call, executive vice president of D.F. King, an investment services firm in New York. "Every market in the world is in panic or close to it."
[End of Partial Transcript]
Wave of Selling Sweeps Across International Borders
Wall Street Traders' Ghastly Day - "The government has to intervene,"
"I guess I should learn to imagine anything."
Plunge Stuns Local Investors - "I watched Dad struggle through the Depression and the thing I learned was that you keep liquid, and you don't owe money,"
A broker at another firm spent the day keeping clients from taking rash actions.
"No," she told one worried caller. "Don't sell. Don't do anything." She listened a bit, and said: "Um, hum. Yeah. I know ... But it's not a crash."
After the Fall, a Nation Befuddled - "The difference between a pigeon and an investment banker was that the pigeon could still make a deposit on a Mercedes."
"Since a lot of people thought that fear brought on by the crash could cause a recession, psychologists were asked about fear.
"The main issue around panic is the theme of losing control, of being trapped," said Reid Wilson, a clinical psychologist who has written a book called "Don't Panic: Taking Control of Anxiety Attacks." "We try to cover for the worst possible scenarios, like a fireman facing a burning building. Will these stairs cave in? How stable is the ceiling? We go back in our minds to the past to find something similar. Here we go back to 1929. That in itself brings out fearful thoughts."