Why is the DOW down?

joepro

joepro

Well-Known Member
A few days leading up to the bailout, the DOW was up.
While the government was falling apart and banks were closing doors
some saw this an a great option for buying in at a low price.
Ok, so i get why the DOW was going up..

Last friday the bill was passed and the bailout was signed into law.
By ends day, on friday, the DOW was down.Today, monday, the DOW is once again, down.
I was told that the very same sub-humans who were bailed out, bailed out on the market now. I'm not sure if that's the case.

Now, I understand it takes time for the market to react to the bailout, well that's what I'm told. After all it's a cash/credit system and we just flooded it with cash for credit, so I don't understand the wait intill later deal while having cash on hand. Isn't it almost like a pre-paid credit card at this point, no?

The bailout didn't help, but infact somehow made it worse?

Can someone help me out, because I'm just not getting it.:confused:
 
medicineman

medicineman

New Member
joepro said:
A few days leading up to the bailout, the DOW was up.
While the government was falling apart and banks were closing doors
some saw this an a great option for buying in at a low price.
Ok, so i get why the DOW was going up..

Last friday the bill was passed and the bailout was signed into law.
By ends day, on friday, the DOW was down.Today, monday, the DOW is once again, down.
I was told that the very same sub-humans who were bailed out, bailed out on the market now. I'm not sure if that's the case.

Now, I understand it takes time for the market to react to the bailout, well that's what I'm told. After all it's a cash/credit system and we just flooded it with cash for credit, so I don't understand the wait intill later deal while having cash on hand. Isn't it almost like a pre-paid credit card at this point, no?

The bailout didn't help, but infact somehow made it worse?

Can someone help me out, because I'm just not getting it.:confused:
Click to expand...
The chickens have come home to roost Joe. This market has been running on hot air for quite some time. That's the gist of it. If you want technocalities, you'll have to ask an expert, I'm not.
 
Spitzered

Spitzered

Well-Known Member
I don't know either, I was considering buying into it, I think I'll wait a bit now. Might go lower. And why has the dollar actually gone up?
 
joepro

joepro

Well-Known Member
Spitzered said:
I don't know either, I was considering buying into it, I think I'll wait a bit now. Might go lower. And why has the dollar actually gone up?
Click to expand...
Remember we just bought a trillion fed notes.
To me that explains how the dollar raised, for the short term.

..for the life of me I can't understand why the DOW is down.
 
NewGrowth

NewGrowth

Well-Known Member
medicineman said:
The chickens have come home to roost Joe. This market has been running on hot air for quite some time. That's the gist of it. If you want technocalities, you'll have to ask an expert, I'm not.
Click to expand...
Well said, the wall street collapse has affected market the world over . . . . We really can't avoid an economic downturn. The government is trying to "artificially" inflate the market. A lot has to do with faith, people are losing faith in the dollar and the stability of the US economy as a result they have become more conservative investing in things like gold, when a hundred year old banking institution fails it tends to scare away investors . . .
 
TheBrutalTruth

TheBrutalTruth

Well-Known Member
joepro said:
Remember we just bought a trillion fed notes.
To me that explains how the dollar raised, for the short term.

..for the life of me I can't understand why the DOW is down.
Click to expand...
Actually the fact that we just bought a trillion dollars worth of fed notes means that we dumped a trillion dollars on the global market which means the value of the dollar should be going down.

And it is, if you compare it to Gold ($86x as of today's close).

Compared to the Euro which just got a bunch of Euros dumped due to Europe's own bail outs it shouldn't be too surprising that the dolalr is up.

The dollar is also up against the Pound, because there are rumors that the Bank of England is really considering lowering their interest rates.

No, I'm afraid what you are seeing isn't a real strengthening of the dollar, but weakening of the alternatives. Continued debasement and inflation of all global currencies.
 
B

Bongulator

Well-Known Member
There are several factors at work here. First of all, the drop today would almost definitely have been much worse without the bailout. But the financial problems are spreading across the globe now, so the nasty shit is just starting to affect other areas of the world. Since it is a global economy, the rest of the world is now dragging us down, just as we are dragging them down.

Secondly, Paulson just appointed a man to oversee the bailout. I doubt he's written any checks yet. They first have to decide which securities to throw money at. I hope they restrict that to primarily Alt-A loans (a step up from worthless paper). Those are much more likely to provide the American taxpayer with a decent return on this investment.

Finally, once they do start making purchases of assets, it won't be like turning a light on. It will take time, probably months, for it to work its way from the top down to the consumer on the street.

And either way, we are heading down, probably for quite some time. If we're lucky, we might recover in two or three years, but I definitely wouldn't count on that. It could be pretty bad for some time. A lot depends on how the rest of the world handles the crisis. So far, the EU is in every-country-for-itself mode, so their own bailouts are going to be patchwork and not as effective as they could be.
 
F

fisherman

Active Member
The American dollar sucks a nut.
1 Euro = 1.3607 U.S. dollars
Time to start thinking about living some where else.
 
TheBrutalTruth

TheBrutalTruth

Well-Known Member
fisherman said:
The American dollar sucks a nut.
1 Euro = 1.3607 U.S. dollars
Time to start thinking about living some where else.
Click to expand...
No, I'll still take my dollars. The Euro is a fake currency created by a fake entity called the EuroZone that really does suck.

For god's sake the EU is dictating the exact placement of cheeses in a grocery store.

Over-reaching, over-intrusive supranational that has too many bureaucrats for its own good.

Screw that!
 
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