"Dow Falls to Worst Close Since March" DUer Joe was RIGHT yesterday.

[in_cog_ni_to]

Is this the beginning of the end?:scared:


Dow Falls to Worst Close Since March
By ELLEN SIMON, AP Business Writer





A pair of traders meet at a phone post ...
NEW YORK - Stocks dropped for the second straight session Tuesday, with the Dow Jones industrial average falling to its worst close since March 9. Global markets also sold off as inflation fears worsened.

The Dow lost more than 110 points in midday trading before narrowing its loss later in the session. The index dropped nearly 200 points Monday after Federal Reserve Chairman Ben Bernanke spooked Wall Street by saying that the central bank will remain vigilant in fighting inflation.

Investors have been hoping the Fed would stop increasing short-term interest rates after 16 hikes; the nation's benchmark rate now stands at 5 percent. However, Bernanke's comments in recent weeks have repeatedly shaken investors and sent stocks tumbling.

"Bernanke came in with this reputation as a great communicator," said John Caldwell, chief investment strategist for McDonald Financial Group, part of Cleveland-based KeyCorp. "Most of us would choose to go back to the general confusion (former Fed Chairman Alan) Greenspan created."<snip>

http://www.comcast.net/news/index.jsp?cat=GENERAL&fn=/2006/06/06/407736.html

[Systematic Chaos]

1. I guess we'll know when they declare Martial Law?

:shrug:

[sweetheart]

2. because of sarbanes oxley

9 out of 10 new listing "dollars" are raised outside of the US, and the
stock exchange buying spree abroad is intended to re-capture this income
lost domestically for stupid and incompetent economic regulation.

And its just another brick in teh wall.

[NewJeffCT]

5. So, corporate accountability is not good?

The SOX laws are designed to hold people like Keny Lay accountable for their actions, so they can't claim they were out of the loop.

[sweetheart]

10. The law is simply bad legislation

All ameircan public companies are paying in blood for it, the stock
markets are paying in blood for it, and nobody is responsible. Smart
companies are de-listing from the US and going to a capital market where
'stupid' is not the regulatory norm.

Sarbanes oxley was a make-work bill advised by consultancies on how
to place lots of consultants in public companies. It does nothing to
stop fraud. It is creating fraud by driving companies away from public
scrutiny.. foolish and typical of all things done under the bush fuckups,
a real cluster fuck that screws the whole economy.

so who's responsible now that the markets are crashing? All the law did
was dump the systemic risk on the public.

[AX10]

16. Perhaps Bush and Company intentionally made Sarbanes-Oxley...

a bad bill just to force companies off of the open market into the private markets where there is little oversight (accountability). NCLB is ruining public education in this country.

[NewJeffCT]

19. I haven't seen many companies de-list...

Though, my old company - which is in the Fortune 100, but is not public - did do that. However, they were in the process of de-certifying even before SOX came into effect. (yes, they still had to do their SEC filings like the 10Q and 10K due to technical rules even though they are not a public company)

No, the law is not perfect - the accelerated deadlines are absolutely stupid...if you want a more thorough filing, you should extend the deadlines, not push them up!

But, the risk was all dumped on the public before - how many billions did taxpayers lose through Enron, Worldcom, etc?

The problem before was that so many companies were so under-staffed in their accounting/finance departments that your typical accountant in a Fortune 500 company is overworked, underpaid & overstressed because they often had too few people doing too many things. In a few years, corporations will have a handle on SOX compliance and things will go back to being relatively normal.

But, in the past few years, huge corporations like MetLife & Prudential in the insurance industry have gone public. Google has gone public. Foreign companies are still trying to buy US corporations...(Westinghouse was acquired by Toshiba - and there aren't many industries more heavily regulated than the nuclear industry, the Chinese oil company tryed to by Unocal, etc)

[sweetheart]

20. The law is incompetent, not just "not perfect"

A proper law would have set up institutional responsibiltiy by forcing
a feedback chain of command as has been proven in investment banking. There,
the "sales" business line is balanced by the "risk" chain of command that
assesses constantly the risks the sales has put the firm in to. But as stands,
the boardroom is clueless to the actual operations of the company.

IF SOX were a proper law, every corporate responsibiltiy would have a boardroom
signatory, not just the CEO, an impossible thing to start with, but a realistic
responsible party for the corporate behaviour.

The letter of the law has usurped the spirit of the law, and though most people
are stupid, 400 firms have pulled their listings from NYSE since 98. http://64.233.161.104/search?q=cache:a1mZemX6IZcJ:fic.wharton.upenn.edu/fic/papers/04/0419.pdf+NYSE+delistings+since+SOX&hl=en&gl=uk&ct=clnk&cd=1

Prior to SOX, 9 out of 10 new issue dollars were US domestic raised, now its the direct
opposite. Regulatory arbitrage has outwitted the half-wits in the congress, idiots.

It is impossible for a CEO to be that aware of the micronic details of multinational
operations. HOlding them responsible is just a joke for consultancies, and the big 4
accountancies to sell fat consultancy and fat bullshit on audit and "responsibility".

US capitalism is pursuing incremental changes, as if a different sort of graft will
be acceptable, when the world has moved on, and nobody's interested without reform...
R E F O R M... of corporate governance, that somebody is responsible for once.

[CAcyclist]

22. Stupid and incompetent?

You must not be a Californian.

[Joanne98]

3. What did the dollar do?

[NewJeffCT]

4. Unfortunately, Bernanke has been stuck with an awful situation

out of control deficits, a plummeting dollar, rising inflation, soaring energy costs, stagnant (or regressing) wages, mediocre job creation, interest rates kept artificially low for 3-4 years, etc, etc.

He might actually be one of the few Bush appointees that are not either a crony or somebody to please the radical RWers, but is actually possibly competent. (I think I recall Paul Krugman saying decent things about him?) However, Bernake is stuck with one of the worst situations this country has seen since the late 1920s. The best he can hope for is to keep the economy afloat on life-support until the 2008 elections. (Yes, I said 2008)

[The_Casual_Observer]

6. It will accordion between 11,000 and 12,000 for the next 5 years.

just like it did between 10,000 and 11,000 for the last 5.

[Matariki]

9. maybe, but i'll bet you a dollar it hits 10,000 before 12,000 n/t

[The_Casual_Observer]

11. I don't think it will ever get all the way to 12 while bush is in office.

I used to think it might, but there is just too much bad news now.

[StellaBlue]

7. Funny I got into a debate about free market capitalism the other day

with a guy I regularly see at our weekly group happy hours. It started off talking about my experiences (fabulous!) with the NHS in the UK, and him declaring that no one in this country went without healthcare. ?!?!?!?! His position was that anyone going without in this country was going without due to lack of initiative/hard work on their part. Well, I'd had three glasses of wine already, and so I lit right into him. "My mother, who's been a legal secretary at the same firm for seventeen years, has no health insurance, despite having worked her whole life, and now working about 60 hours a week - does she not work hard enough?". I went on to explain my view that, in any community with the resources that our nation has, it is IMMORAL that people can die or even suffer needlessly because they can't afford the outrageous costs of going to a doctor.

You can see where this is going.

Anyway, my original point was (haha!) that this guy was trying tell me that the reason our economy is SO robust, while Europe's is "tanking" is because of their high taxes, socialism, etc. :rofl: I was just too shocked to respond. He justified all this Alex P Keaton bullshit by saying he had an economics degree (so obviously he knows ALL about it? haha!). la-dee-da! Finally, I managed to ask him about how robust it is that China owns billions and billions of dollars of our debt?

:mad:

To me, the whole system is a big casino. And even more rigged than Vegas.

[TheWatcher]

12. That was a point I made yesterday

The whole system has become more of a casino and a farce than most people understand. Don't let the whole "I have and economic degree so I know everything" BS that people try to shove down your throat intimidate you. I don't even try to reach people like that anymore. It's useless.

I know people with Bachelor's and Masters in Economics that took quite a Bloodbath when the Bubble burst in 2000 and faithully rode it all the way down to 2003. Just because you work for a brokerage or have a degree does not always mean you know what's really going on.

Anyone who thinks our economy is robust right now is either uninformed or one of the 5% that have actually benefitted from Bush's economy. SOME people are still squeaking by, but most have no idea how precarious things are.

And while it's true a lot of the dire predictions some have made on DU may not ever come to pass, whistling past the graveyard with Pollyanna Bunny Ears and a brain filled with CNBC happy talk is not a wise move in this environment.

AT ALL.

[Roland99]

14. heh...I was calling the 2000 crash for nearly a year

I see more than a correction happening soon.

The markets' volatility has increased quite a bit lately and even up days have had Adv/Dec ratios favoring the Decliners. Investors are flocking to safety in the big Dow components so watching merely the Dow is not indicative of the entire picture.

[catzies]

13. I've been using the "Wall Street = Casino" line for years

"...and the house always wins."

I told my day-trading ex-boyfriend that & he went ballistic (defense mechanism).

[StellaBlue]

15. Hey, I have one of those, too!

Asshole investment banker (what the HELL was I THINKING?!?!).

:hi:

[catzies]

25. LOL, I can relate! The daily drama of hearing about his portfolio is

one of many things I don't miss!

:hi:

[catzies]

26. "I wish the war would just start, it's killing the markets." -actual quote

Fall, 2002. I told him that was disgusting.

[StellaBlue]

27. How 'bout

"Those lazy people in Africa deserve to die."

or

"China has things about right, I think."

:nuke:

[Odin2005]

24. They don't call it Free-Market Fundimentalism for nothing.

The Neo-Libs have been predicting impending doom unless Europeans gets rid of the Welfare State and business regulations for ages now and nothing happens, they're like fundies that are so sure they'll be raptured any day now. :crazy:

[Matariki]

8. worse since MARCH - 3 months ago

not really the end of the world there. sensible people have been expecting a market correction for a while now.

[pretzel4gore]

17. what about the Plunge Protection Team?

i notice that even the local 'finance' news readers avoid saying anything that suggest that there are real problems in the markets. when the markets fall, it's due to iran, or iraqi terrorists, or n korea, or chavez etc doing something;when they rise, it's because the economy is 'robust'...this pattern has been going on for years (if anyone remembers, in the days leading up to iraq 'war' the stock market rose and fell according to whether the killing was going to start or if something delayed it....it was almost silly that the outbreak of bloodshed sent the markets way up while peace caused a big fall. the talking heads were tying themselves in knots avoiding talking about the obvious)....if the PPT has been propping up the markets by leveraging the price of oil and the dollar and outright buys of stock to keep the markets 'robust' all the while greenspan was playing with the fed to keep housing bubble full, and interest rates low enough to allow the illusions to be maintained, surely there are responsible people in the system who know and who can at least warn us that this 'criminal activity'been going on? i know nada about economics, but vividly recall Jimmy Carter's 58 billion deficit in 1979 which drove the pigmedia nuts and caused front page fears of doom (he was bankrupting the country, jimmy was!) when only 2 years later regan ran 200 billion deficits as routine, and the pigmedia only mentioned that in the finance news pages. all this says that we can't really know how healthy the economy is with pigs running the media. That alone should galvanise the citizenry;they are losing $$$ bigtime every minute bush is allowed to pretend he's president....
:shrug:

[FloridaPat]

18. The beginning of the end was January 2001 when * took the oath

to destroy the Consitution. The big question is how far are we from bottom and how bad can it get before the people in this country decide to run their own country.

[Rex]

21. When the Market farts

people listen. I hear a person shaits their pants upon death; let us hope this is just gas escaping and nothing more.

[lastknowngood]

23. If it were not for the ppt pumping billions in to stocks we would be

near 9000 today and headed for 5000 and hoping it holds.

ppt Plunge Protection Team