Admittedly, economics is not my area of expertise. It has been a long, long time since I took Economics 101 at the University of Idaho. I probably know less about economics than even John McCain. I do know enough, however, to know that today’s news is not good…
NEW YORK (CNNMoney.com) — Stocks tanked Monday, as investors reeled amid the fallout from the largest financial crisis in years after Lehman Brothers filed for the biggest bankruptcy in history and Bank of America said it would buy Merrill Lynch in a $50 billion deal.
Treasury prices rallied as investors sought the comparative safety of government debt, sending the corresponding yields lower. Oil prices tumbled, falling well below $100 a barrel on slowing global economic growth. The dollar rallied versus other major currencies and gold prices spiked.
The Dow Jones industrial average (INDU) lost 500 points, or 4.4%, according to early tallies. It was the biggest one-day point decline for the Dow since Sept. 17, 2001, when the market reopened for trading after having been closed in the aftermath of 9/11 terrorist attacks.
The Standard & Poor’s 500 (SPX) index lost 4.5% and the Nasdaq composite (COMP) lost 3.6%.[..]
Art Hogan, chief market strategist for Jefferies & Co., said the magnitude of the financial industry fallout is unprecedented, and could only be compared to the Great Depression of the 1930s or the railroad bankruptcies of the 1800s.
“We’ve never witnessed this before,” said Hogan. “There’s no road map for this.”
Republican presidential nominee John McCain still believes that our economy is sound.
Here’s Democratic vice presidential nominee Joe Biden:
(Watch full Biden speech here.)
I am not enough of a pessimist to believe that we will not recover from today’s setbacks. We usually do. With the right leadership, we will recover even faster. But let’s not kid ourselves… there are some rough times ahead. The conservative leadership under with America is now laboring (and which Sarah Palin and Johnny McCain want to continue) has put us in quite a mess. I don’t know if the United States would survive another four years of this kind of conservatism, and I’m not particulary anxious to find out. Are you?
Update, via ABC News:
The Dow Jones had its biggest single point drop for 2008, losing 504.48 points (-4.42%) to close at 10917.51. It was the sixth biggest point drop in the Dow Jones history, the biggest point drop since the first day of trading after 9/11 on September 17, 2001, and the biggest percentage drop since July 19, 2002. The Dow closed at its lowest point since July 21, 2006.
Year to date, the Dow is down 17.7%, and from its peak in October, 2007, the Dow has lost dropped nearly 23%.
The S&P 500 had its lowest close for the year, losing 59 points (-4.71%) to close at 1,192.70 and the NASDAQ lost 81.36 points (-3.60%) to close at 2,179.91.