Dow Plunges More Than 150 Points (actually 170 points at 12p CST)

[Robbien]

NEW YORK - Stocks plunged Wednesday after a stronger-than-expected rise in consumer inflation intensified Wall Street's fear that interest rates will keep climbing. The Dow Jones industrial average lost almost 150 points.

Investors were disappointed by a Labor Department report that its consumer price index swelled 0.6 percent in April, ahead of forecasts of a 0.5 percent gain. But core CPI — without food and energy — also grew a faster-than-anticipated 0.3 percent, adding to worries that soaring oil prices have begun to lift prices elsewhere.

. . .

"The CPI data really kicked the market in the teeth today," said Ken Tower, chief market strategist for Schwab's CyberTrader. "So the question now really is where can we find some support?"

Tower added that a sliding U.S. dollar was also weighing on the market's mood. The dollar continued losing ground to the Japanese yen, while gold prices jumped past $710 an ounce.

"The dollar has depreciated quite sharply since the Fed started talking about stopping its rate hikes," Tower said. "It's not so much that the dollar is depreciating — it's the speed of the depreciation that is worrying the currency market. The dollar is down 6 percent in one month, which is a lot."

http://news.yahoo.com/s/ap/20060517/ap_on_bi_st_ma_re/wall_street

[Demeter]

1. The Beginning of the End

Those who will not learn from history are doomed to repeat it.

[Xenotime]

9. Exactly....This is one of the worst economys in the history of the US

[Sammy Pepys]

2. Hoo ah!

Bummer, but I've got time.

[The_Casual_Observer]

3. By the end of the week bastards will be saying that inflation is a plus

and the markets will be up because of all the "bargains". It's all bullshit.

[Warpy]

4. I'm not the least bit surprised

I'm only a little surprised that it's stayed up this long, housing market decline and all.

[hadrons]

5. But, but, but the Wall St. Journals says everything is great

The Tax Cut Record
Americans are better off despite Democratic naysaying.

Sunday, May 14, 2006 12:01 a.m. EDT

Our late editor Bob Bartley used to say that critics might forgive you for being wrong, but they'll never forgive you for being right. That psychological insight may be the only way to explain the fierce and bitter opposition this week to extending the tax cuts of 2003 for another two years through 2010.

If ever there was a market test of economic policy, the last three years have been it. The stock market has recovered from its implosion in Bill Clinton's last year in office, unemployment is down to 4.7%, and growth has averaged 3.9% in the three years since those tax cuts passed--well above the post-World War II average and more than twice the growth rate in Euroland.

Yes, gas prices are high and interest rates are rising, which helps to explain the anxiety felt by some of the public. But these headwinds are all the more reason to be impressed by the economy's ability to push ahead nonetheless. We'd have thought that the Democrats who are now voting to let taxes increase would be thrilled to know that things turned out better than they had feared. Americans are better off despite Democratic predictions that, as Minority Leader Nancy Pelosi put it back in 2003, tax cuts would "damage long-term economic growth."

Alas, admitting error is not a natural political act, so the tax cut critics are now suggesting all of this growth would have happened anyway. Thus the Washington Post last week quoted Robert Rubin--the Clinton economic guru--as dismissing the importance of tax cuts because "we had very good markets in the '90s before all these tax cuts went into effect." And it quoted chief Lehman Brothers economist Ethan Harris as saying that the expansion "has nothing to do with tax policy, and more to do with the corporate sector starting to spend some of their record profits."

Well, what does Mr. Harris think inspired that revival of business spending? Spontaneous combustion? A Nascar green flag? As for Mr. Rubin, when does he think the stock market imploded and the economy headed downhill? Bill Clinton was still in office when the dot-com boom went bust and U.S. manufacturing was shedding jobs faster than France.

http://www.opinionjournal.com/editorial/feature.html?id=110008374

so is it Clinton's penis again?

[katinmn]

6. oops. Thought it was WaPo. Ok, WSJ wants investors to

stay positive!

[Demeter]

33. Yeah, Clinton Told Kenny Boy, His Friend and Fund-Raiser, To

commit massive fraud so the stock market would crash, and he also told all his other cronies at WorldCom, and Tyco, and KMart, and all those other Pioneering frauds, and....


What's that you say? Ken Lay and Co were BUSH friends and supporters? Their fraud went directly into Bush's campaign?

Ah, where's your narrative sense?

[NeoConsSuck]

39. This is the typical right wing smear..

"The stock market has recovered from its implosion in Bill Clinton's last year in office,"

The truth, puke Greenscum raised interest rates too much and too fast, and Greeny was blamed for tanking the market.

And any Dem investor worth his salt knows Greenscum did this to hurt Gore's chance to win election that year.

The effing pukes never fail to amaze me how they cannot accept blame for anything of their doing.

What's next WSJ? An editorial by Judy Miller laying the blame on Iran?

[MADem]

7. Inflation??? Wha, hush mah mouth!!!!

All of the "better off than most, but not REALLY rich" crowd will find out just how bad it is when they go off on their European vacations, only to discover that they're gonna have to shell out way more dollars to buy those Euros than they used to!

Edit/spelling!

[Up2Late]

8. Here are a few charts for those without Cable TV

<http://newsvote.bbc.co.uk/2/shared/fds/hi/business/market_data/overview/default.stm>

Dow Jones (20 min dalay)
http://newsvote.bbc.co.uk/2/shared/fds/hi/business/market_data/overview/img/2+bbc-thumbnail_thick-line+intraday.png

Nasdaq (15 min delay)
http://newsvote.bbc.co.uk/2/shared/fds/hi/business/market_data/overview/img/12122+bbc-thumbnail_thick-line+intraday.png

S&P 500 (10 min delay) at link below:
<http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/stockmarket/11826/default.stm>

[jayfish]

10. Just Crossed The 200 Point Mark!

Ouch!

Jay

[ShortnFiery]

11. Oh my, and to think

All those "charming compliments" by Kyra Phillips and Ed Henry - Re: Tony Snow may not result in a check in the mail for CNN this week. Bummer man! :P

[ConcernedCanuk]

12. We can't bring down the USA militarily, but we can with $$$

.
.
.

Canada is marketing it's oil, lumber and beef across the oceans - getting tired of the USA's "dinging" us on their so-called "Free-Trade"

We are far from unique

The USA is getting the proverbial "shut-out"

Another "crash" similar to the 1929 disaster is inevitable in the ole US of A

And they ASKED for it this time, and will be much worse IMO

pissing off the whole World is NOT a good idea

don't matter HOW much power ya got

the "peasants" WILL revolt sooner or later

It has always been that way

:nopity:

[ShortnFiery]

13. "pissing off the whole World is NOT a good idea"

But pissing off the whole world is what this Administration seemingly does best. :thumbsdown:

We're going to have to start from square one IF, and that is IF we are able to take control out of the Neo-Conservative Warmongers presently at the helm. IMO, expect almost anything to derail this November's Elections. :(

[aquart]

14. Could you try not to gloat?

We're the peasants suffering here.

[happynewyear]

15. yeah no sh*t

I wonder how many out there realize that there is a segment of our sociey of poor and disabled persons?

We are being hit hard because we are poor and don't have money for most things.

I hope that things get better, not worse.

We need to get new people in charge of this government. We need people that give a damn about the American people and that is ALL of the American people.

:kick:

[ShortnFiery]

16. I fear it will take a whole lot more suffering until we WILL

HOLD our Democratic Representatives accountable. I hate it too, but things are going to get a great deal worse before they begin to get better. Hold your family and friends dear and care for each other ... this is going to be a long cold winter. :scared: :( :hi:

[brentspeak]

19. Our Democratic representatives?

Did you forget which party is holding all the power in Washington?

[ShortnFiery]

20. Hello? They CAN filibuster Hayden ... they must!

Stop getting all pissy with the blunt jab remarks ... you do realize, I hope, that we ALL have had better days? ;) :hi:

[brentspeak]

18. You can shut up now

[ShortnFiery]

21. Yes another example to the world of us "ugly" vice "tolerant" Americans

Atta boy, now we can announce to others on this board THAT us Americans are boorish in Nationalistic Fervor.

:( :thumbsdown:

[brentspeak]

22. Learn the difference between the "ugly American"

and the "proud American".

[Robbien]

23. Isn't there such a thing as "proud Canadian" and do they not have

the right to speak their pride without being told to shut up?

[ShortnFiery]

28. Pride is one of the Seven Deadly Sins ... a little good - arrogance = bad

[ConcernedCanuk]

41. WHAT? - even an explanation for that rudeness would be welcomed

.
.
.

Telling one to "shut up" is not considered polite - at least not here in Canada

A reasonable argument to what I had posted would be entertained - -

HECK

even an UNREASONABLE argument has a good chance of getting a response from me explaining my post

but just a basic "STFU" ??

hope you are a rarity down there

but then again

you got a warmonger for a president

You may be one of the reasons

convince me I'm wrong

please

[ramapo]

25. That's how we beat the USSR

Spent them to death. Now we've used the same technique to commit suicide.

[brentspeak]

17. Weren't Republicans just now saying that the stock market is an accurate

reflection of the strength of our economy? Morans.

[maxrandb]

24. Did I hear correctly that the "fail-safe" measures kicked in?

I'm not an economist and don't really know all the ins and outs of the market, but I thought I heard somebody say that the electronic protections kicked in to stop it from sliding more.

After the Depression, didn't they put some mechanism in place that would stop trading if the markets started crashing?

Just a stupid question from one of the "non-investing" class.

[Solon]

27. Yeah, its called shutting down the market...

they close for the day and pray that the next won't be as bad.

[NorthernSpy]

36. kind of like hitting the 'SCRAM' controls on a nuclear reactor...

... in hope of averting a meltdown.


:think:

[m0nkeyneck]

26. it's May.. was expected

[cliss]

29. There is something strange going on.

It appears that we have 2 things going on, simultaneously.

1) We have inflation. The CPI shows that prices are going up. Not just a little bit, either. This would indicate that we have a massive amount of dollar bills covering the earth. The Fed has stopped telling us how much the M3 money supply is, so chances are they are stoking up the printing presses day & night.

2) At the same time, we have massive poverty and unemployment (and underemployment) in this country.

These 2 scenarios should be mutually exclusive; you can't have 1 without the other.

Inflation means there are too many dollars chasing too few goods. If you have a lot of laid-off people who are just barely getting by, you have inflation (and also interest rates) under control.

That's Reagan's dirty little secret. He said he would create a vast army of poor people to keep the inflation rate down. Any thoughts?

[TomClash]

30. You have to factor in . . .

the decline of the dollar and the significant commodities price increases.

[taught_me_patience]

32. The official term is "stagflation"

the worst of all economic conditions. Inflation is growing but GDP is not.

[Demeter]

34. Stagflation

Where were you in the 70's?

[catmandu57]

31. We're going to have to watch this for a few days

The nasdaq has been falling for the last couple of weeks, the dow has been flat, we'll have to see who is buying now, and if they have the juice to prop it back up.

[niallmac]

35. Hmm. This is it? The DOW drops 200+points and only one thread?

I thought the DU posts would be impressive when I got home given the saucers and plates condition of our economy.
I watch the stock market with OBL in mind. He knows we are capable of destroying ourselves and investors
unlike the MSM do not lie. They can't afford to candy coat reality.
On the other hand there may be other grander threads and I still haven't figured out how to find them.

[muriel_volestrangler]

37. The Dow isn't 'the economy'

It's a gambling system based on company profits. One day's change doesn't mean much; a prolonged rise or fall affects people's pensions, or the amount of new money that people invest in companies, and that's when it becomes important.

[Paulie]

38. the DOW is only 30 stocks

Just happen to be blue chip/large companies.

[niallmac]

40. Well, I'll keep my eye on the little bugger non the less.n/t