Wondering why you feel seasick? Look at what the S&P; 500 has done this month:
- — Sept. 2
- — Sept. 3
- -3% Sept. 4
- — Sept. 5
- +2% Sept. 8
- -3% Sept. 9
- +1% Sept. 10
- +1% Sept. 11
- — Sept. 12
- -5% Sept. 15
- +2% Sept. 16
- -5% Sept. 17
- +4% Sept. 18
- +4% Sept. 19
- -4% Sept. 22
Today once again, markets are moving on nothing fundamental as investors await the details of the government plan.
Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke testify before Congress today about their $700+ billion bailout scheme. I hope somebody has the guts to ask Mr. Paulson whether a big cause of the current crisis is the 2004 waiver of net capitalization rules that enabled his former firm, Goldman Sachs, and four others to leverage beyond the 12-1 limit. Watch the testimony here.
Don’t hold your breath. It sure is handy to have cronies in Washington when your firm blows up and you want taxpayer money.
Meanwhile, General Motors, a stock we’re interested in below $8 per share, saw its rating drop to “CCC” at Fitch Ratings yesterday. That’s the eighth-lowest speculative grade in the firm’s corporate rating scale. Rumors say GM will need to raise even more cash. Of course, it’s hoping for some from Washington since that’s where all cash comes from these days.
The stock’s at about $11.40 in early trade.
