Recovery to last Monday morning's level! Whew! Volatility!!!
Teaching Financial Markets & Institutions next week will be anything BUT boring, eh?!!? VOLATILITY (or as our students say here "fluctuations" - they learn English through the school, SILC stands for Sydney Institute of Language and Commerce! - the LANGUAGE part helps ME to do a better job as the students at least understand some of what I say and most of what I write. Thus the PPT - as they call them - the PowerPoint slides, are CRUCIAL! And I used to HATE PPT!!!)
So we are almost back to Last Monday morning (See Friday, November 14th's post, we were at 8,497.31):
The New York Times (graph above comes from the article linked) likes to talk about a 12% increase in two days (as does Bloomberg.com). All that says to me is volatility, especially when we are not even back to where we were a week ago!
ALSO notice the drop in the last 20 minutes - from almost 6.5% up to 5% - that's like a 100 point drop in 20 minutes!!! YIKES!!
No doubt the confirmation of the nomination of Geithner to Treasury Secretary was a positive, but the markets always look AHEAD. The Citigroup Bailout - Government ownership (or whatever you want to call it) was the big news. Look at the stocks which moved: JP Morgan/Chase, Bank of America, Goldman Sachs, Morgan Stanley, Merrill Lynch ALL up 20% or more (of course with the prices they are listed at today that's still not a huge increase compared to a year or two ago, eh?!!?). Citigroup gets a $306 billion "shield" and $20 billion bailout!! (Bloomberg.com link) Yet the auto companies don't deserve? Oh, see below - perhaps Congress wasn't really impressed with the auto companies' plans for the future - but were they ever impressed with the financial companies' plans either?! Hmmm, ... stay tuned!
Did you notice that "they" are calling the Citigroup bailout - Bailout #3!!! - Citigroup was too big to fail, no doubt about it, in the government's mind. Very interesting, we are still providing bandaids, not dealing with the issues. That is, we are jumping from crisis to crisis and have yet to get ahead of the problems, anticipate them and recognize what is at issue.
Related: Did you see this article on Ford in the New York Times? Nice, if true, that Ford is ahead of GM and Chrystler at dealing with their situation. I also noted earlier that Ford has the largest loan due in about 1 year. THEN they WILL have to be ready, but the financial crisis does not have THEM scrambling for a bailout ... not just yet (although Ford would take one, if offered ... grin).
So we are almost back to Last Monday morning (See Friday, November 14th's post, we were at 8,497.31):
The New York Times (graph above comes from the article linked) likes to talk about a 12% increase in two days (as does Bloomberg.com). All that says to me is volatility, especially when we are not even back to where we were a week ago!
ALSO notice the drop in the last 20 minutes - from almost 6.5% up to 5% - that's like a 100 point drop in 20 minutes!!! YIKES!!
No doubt the confirmation of the nomination of Geithner to Treasury Secretary was a positive, but the markets always look AHEAD. The Citigroup Bailout - Government ownership (or whatever you want to call it) was the big news. Look at the stocks which moved: JP Morgan/Chase, Bank of America, Goldman Sachs, Morgan Stanley, Merrill Lynch ALL up 20% or more (of course with the prices they are listed at today that's still not a huge increase compared to a year or two ago, eh?!!?). Citigroup gets a $306 billion "shield" and $20 billion bailout!! (Bloomberg.com link) Yet the auto companies don't deserve? Oh, see below - perhaps Congress wasn't really impressed with the auto companies' plans for the future - but were they ever impressed with the financial companies' plans either?! Hmmm, ... stay tuned!
Did you notice that "they" are calling the Citigroup bailout - Bailout #3!!! - Citigroup was too big to fail, no doubt about it, in the government's mind. Very interesting, we are still providing bandaids, not dealing with the issues. That is, we are jumping from crisis to crisis and have yet to get ahead of the problems, anticipate them and recognize what is at issue.
Related: Did you see this article on Ford in the New York Times? Nice, if true, that Ford is ahead of GM and Chrystler at dealing with their situation. I also noted earlier that Ford has the largest loan due in about 1 year. THEN they WILL have to be ready, but the financial crisis does not have THEM scrambling for a bailout ... not just yet (although Ford would take one, if offered ... grin).
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