So the Feds have staved off the "Running of the Bulls Bears"?
Well it would appear that they have for today at least.
Until of course everyone wakes up tomorrow and recovers from the hangover and notices that they are only just back where they started? Today’s *massive* rally has simply clawed back the gains from last Wed. and I can’t help thinking that it’s not a good idea to add more and easier access to money when we are seeing a worldwide credit squeeze? Surely this is like pouring petrol on an already lit fire? Is this some neat way to make it burn bigger and brighter so that it consumes things faster?
So what are the Feds going to do next week or month when they see a drop of 6 - 800 points over a week? add another couple of hundred billion to the pile?
If anyone has a bright suggestions of what to do with Cash (apart from give it away) please drop me a line - but it’s getting scary out there.
U.S. Stocks Advance Most in Five Years on Fed’s Liquidity Plans
By Eric Martin
March 11 (Bloomberg) — U.S. stocks rallied the most in five years after the Federal Reserve said it will pump $200 billion into the financial system to shore up banks battered by mortgage- related losses.
Citigroup Inc., Bank of America Corp. and Fannie Mae led the Standard & Poor’s 500 Financials Index to its biggest gain in eight years on expectations the Fed’s move will spur lending. Washington Mutual Inc. climbed the most since 2000 on speculation the largest savings and loan will get a cash infusion from an outside investor. All 10 industry groups in the S&P 500 rose except for health-care companies, which fell after WellPoint Inc. cut its earnings forecast.
The S&P 500 added 47.28 points, or 3.7 percent, to 1,320.65, climbing the most since October 2002 and trimming its decline for the year to 10 percent. The Dow Jones Industrial Average surged 416.66, or 3.6 percent, to 12,156.81. The Nasdaq Composite Index increased 86.42, or 4 percent, to 2,255.76. Almost 11 stocks gained for every one that fell on the New York Stock Exchange.
“It’s like they’re putting jumper cables onto a battery to kick-start the credit market,” said Nick Raich, who helps manage $34 billion at National City Private Client Group in Cleveland. “They’re doing their best to try to restore confidence.”
Loading ...