Well now that the debt ceiling debate is over and the Treasury burned through about 60% of the $400 Billion in new boworrowing authority in a single day, it seemed the markets decided to get bact to "the previously scheduled program." While the various partisan pundits busied themselves blaming their respective opposition for todays meltdown on the DJIA,they tend to ignore the fact as bad as it was on Wall Street the situation in the Euro Zone was far, far worse. Not only were all the various borses off nearly as much as the Dow, the soverign bond market virtually shut down. The sell off in Italian bank stocks was so diasterious trading in the largest banks was suspended. No matter how high they push up the yeild on PIIGS bonds there are no buyers to be found. So it looks like ECB will be forced to step in and buy, i.e. print more and more Euros.
With the US markets already skitish after and extended sell off the panic on the trading floors must have been palpable. With about 45 mins. to go until closing those investors that had been hanging on all day hoping for even a small reversal threw in the towel and the market fell another 150 points.
I can't imagine there are many stock brokers or hedge fund managers that are getting much sleep tonight. Far as I'm concerned, serves them right. All that pumping up prices on low trade volumes just came back and bit them on the backsides. It's not like there haven't been those of us warning this would happen.
No comments:
Post a Comment
Comments are of course welcome. Please stay on topic. Comments with links to commercial sites unrelated to the post or the general theme of this blog will be deleted as spam.