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Originally posted by JacKatMtn
Recession Fears Blanket Wall Street; Dow Plunges 300 Points
(visit the link for the full news article)
The Dow lost another 300 points and the S&P fell 2.9% to its lowest level since October 2006 on a series of major news and economic reports that all raise serious questions about the direction of the economy.
The industrial average has now fallen more than 1,000 points 2008.
Related News Links:
Originally posted by infinite
It's getting much worse
Bond insurers spark new credit-crisis fears
Shares in Ambac Financial and MBIA, the world’s biggest bond insurers, fell 65 per cent and 40 per cent, respectively, after Moody’s Investors’ Service raised the possibility that Ambac might lose the triple-A credit rating on which the insurers depend.
Credit crunch enters new phase
The US is at risk of losing its top-notch triple-A credit rating within a decade unless it takes radical action to curb soaring healthcare and social security spending, Moody’s, the credit rating agency, said on Thursday.
The warning over the future of the triple-A rating – granted to US government debt since it was first assessed in 1917 – reflects growing concerns over the country’s ability to retain its financial and economic supremacy.
Originally posted by infinite
Take a look how bad it is in the UK
Investors bale out of Britain
The pound has plunged and stocks are officially in a bear market, but there are still ways to profit
The FTSE 250 index of medium-sized firms – a better indicator for the state of the British economy than the main FTSE 100 index because it contains more domestic businesses – has now dropped 20% since its peak in early June. The Footsie is down 6% since then and 4% since the start of the year.
He said: “Last month saw close to the biggest single monthly drop of the pound since the exit from the exchange rate mechanism at the start of the 1990s, and suggests that the world is developing a different view of the UK. This seems justified as there are lots of reasons to be bearish on the pound.”
In a dramatic reversal to last year, sterling dropped to $1.9575 last week, its lowest level since March. It has slid 8% in the past two months from $2.11, its highest since 1981. The fall against the euro has been equally dramatic: from 70p to 75p.
I heard Cramer say tonight on mad money that there is a looming bank insurers crises and that if the government doesn't act quick to buy(?) these defunct insurers out we could have an Armageddon banking crises in weeks (or even days).
American today is going deeper and deeper into debt. At the same time, jobs in fields like manufacturing and IT are being outsourced to low-wage countries overseas at an alarming rate; this current course will devastate our economy and result in our fall from grace as the world’s economic superpower.
Devastated by tightening credit markets and the mortgage mess, Wall Street firms have sent out an S.O.S.
Their cries have been answered in large part by overseas investors, which have agreed to inject billions of dollars into America's biggest banks
WASHINGTON: Retailers, home builders and many manufacturers should brace for even more rough times ahead, a somber Federal Reserve suggests amid growing fears that the US might be sliding into recession.
In a bid to save the world's largest economy from recession, U.S. President George W. Bush and central bank chief Ben Bernanke yesterday endorsed a $100-billion stimulus package as the spreading housing mess continued to hammer banks, consumers and investors.
Country's central bank says foreign exchange reserves added $461.9 billion last year. China's foreign exchange reserves hit $1.53 trillion at the end of 2007, up 43 percent from the end of the previous year, the central bank said Friday.
The bank said in a statement on its Web site that $461.9 billion was added to the country's foreign exchange reserves in 2007.
WSJ and FT on How Far Down is Down, Exactly? (Bond Insurer/Counterparty Risk Edition)
...At the center of these concerns is a vast, barely regulated market in which banks, hedge funds and others trade insurance against debt defaults....called credit-default swaps, in which one party, for a price, assumes the risk that a bond or loan will go bad....
"You are essentially counting on the reliability of strangers" to pay up on their contracts, notes Warren Buffett, the Omaha billionaire. In some cases, he says, market players can't determine whether their trading partners have the ability to pay in times of severe market stress. Full Text