U.S. Stock Futures Bounce After Monday’s Plunge
September 30th, 2008 Posted in Mitt Romney
By Steve Goldstein, MarketWatch
Last update: 7:15 a.m. EDT Sept. 30, 2008
LONDON (MarketWatch) – U.S. stock futures pointed to a partial recovery Tuesday after the previous session’s historic loss on hopes the House of Representatives will pass a similar rescue plan to the $700 billion bailout package rejected in the last session.
S&P 500 futures rose 25 points to 1,143.80 and Nasdaq 100 futures added 13.5 points to 1,525.50. Dow industrial futures rose 136 points.
Overseas markets also were performing relatively well after Monday’s bruising. The Nikkei 225 tumbled 4.1% in Tokyo, but the Hang Seng closed higher and the FTSE 100 was steady.
September 30th, 2008 at 8:26 am
Thanks John for the update.
It appears cooler heads and reason is prevailing today. There is a sober acknowledgement that some type of bill has to pass and will be passed by the weekend.
The only hope we can have is that it is more conservative in nature and pulls back a bit on the intervention of free market principles.
Here is a presidential poll update for everyone that I pulled from Hotline:
An early look at today’s Diageo/Hotline tracking poll shows Sen. Barack Obama now holds a double-digit lead in key battleground states.
Among registered voters surveyed in Colorado, Michigan, New Hampshire, New Mexico, Florida, Ohio, Pennsylvania, Virginia, Wisconsin and Nevada, Obama tops McCain 50 to 40%. Just a week ago, Obama led 45% to 42%.
Nationwide, Obama leads 47% to 41%.
The Research 2000 tracking poll has Obama leading 51% to 41%, while Rasmussen has Obama up 51% to 45%.
September 30th, 2008 at 8:58 am
SED
A problem is that the market isn’t as free as people would like to believe it is. It was intervention in the market that caused this crisis. Intervening again, no matter the necessity, will cause other implications.
Government bailouts appear to be cyclical over the past two and one half decades.
September 30th, 2008 at 9:31 am
Hi Pals,
I’m against the
$85,000,000,000.00 bailout of AIG.
Instead, I’m in favor of
giving $85,000,000,000 to America in a ‘We Deserve It Dividend’.
To make the math simple, let’s assume there are
200,000,000 bonafide U.S. Citizens 18+.
Our population is about
301,000,000 +/- counting every man, woman and child. So 200,000,000
might be a fair stab at adults 18 and up..
So divide 200
million adults 18+ into $85 billion that equals $425,000.00.
My
plan is to give $425,000 to every person 18+ as a We Deserve It
Dividend.
Of course, it would NOT be tax free.
So let’s assume a tax rate of 30%.
Every individual 18+ has to pay $127,500.00 in taxes.
That sends $25,500,000,000 right back to Uncle Sam.
But it means that every adult 18+ has $297,500.00 in their pocket.
A husband and wife has $595,000.00.
What would you do with $297,500.00 to $595,000.00 in your family?
Pay off your mortgage - housing crisis solved.
Repay college loans - what a great boost to new grads
Put away money for college - it’ll be there
Save in a bank - create money to loan to entrepreneurs.
Buy a new car - create jobs
Invest in the market - capital drives growth
Pay for your parent’s medical insurance - health care
improves
Enable Deadbeat Dads to come clean - or else
Remember this is for every adult U S Citizen 18+
including the folks who lost their jobs at Lehman Brothers and every
other company that is cutting back. And of course, for those serving
in our Armed Forces.
If we’re going to re-distribute wealth
let’s really do it…instead of trickling out a puny $1000.00 ( ‘vote
buy’ ) economic incentive that is being proposed
by one of our candidates for President.
If we’re going to do an $85
billion bailout, let’s bail out every adult U S Citizen 18+!
As for AIG - liquidate it.
Sell off its parts.
Let American General go back to being American General.
Sell off the real estate.
Let the private sector bargain hunters cut it up and
clean it up.
Here’s my rationale. We deserve it and AIG
doesn’t.
Sure it’s a crazy idea that can ‘never work.’
But can you imagine the Coast-To-Coast Block Party!
How do you spell Economic Boom?
I trust my fellow
adult Americans to know how to use the $85 Billion
We Deserve It Dividend more than I do the geniuses at AIG or
in Washington DC
And remember,
The plan only really costs $59.5 Billion because $25.5 Billion is
returned instantly in taxes to Uncle Sam.
Ahhh…I feel so much better getting that off my chest.
Kindest personal regards,
Birk
T. J . Birkenmeier, A Creative Guy &
Citizen of the Republic
September 30th, 2008 at 11:29 am
Interesting idea Stephen.
However, I’m never a big proponent of government just handing out money. It makes me think of welfare. It’s also a big reason why I was against the FAIR Tax.
From what I understand in regards to the AIG deal is that it is apparantly an 85 billion dollar loan that would eventually someway be paid back in many ways by seling of the companies assets or returning it to profitability.
John Cronin please correct me if I’m wrong.
September 30th, 2008 at 12:12 pm
As expected, the GOP are the villians for all things wrong in the country.
Here’s a poll on yesterdays events:
Poll: GOP blamed for failed bailout
By Andy Barr | 9/30/08 @ 1:16 PM EST
Respondents to a new ABC News/Washington Post poll blame Republicans over Democrats by more than a two-to-one margin for Monday’s failed vote on the $700 billion bailout package.
The poll, conducted Monday evening after the vote, reported 44 percent of respondents said the GOP is “mainly responsible” for the failed deal. Twenty-one percent blamed Democrats while 17 percent said the two parties share equal blame. The survey interviewed 424 registered voters and has a five percent margin of error.
Forty-seven percent of those polled oppose the bailout while 45 percent said they support it. Only a slim majority, 51 percent, expressed confidence that the proposed bailout would prevent the current financial crisis from getting worse.
But while Americans are split over the bailout, a vast majority, 88 percent, said the failed vote “could lead to a more severe economic decline.”
House leaders on both sides have blamed the other party for Monday’s vote, but seem ready to reconvene Thursday to hash out their difference on a new package.
Both Barack Obama and John McCain support the bailout and say they have been in continued discussions with the White House and party leaders as they work on a new deal.
White House spokesman Tony Fratto said Tuesday that Bush, “intends to stay here to work on this financial rescue package with members of Congress for as long as it takes to get this done, because it is — it is critical.”
The ABC News/Washington Post poll is the first major survey since Monday’s failed vote.
September 30th, 2008 at 12:19 pm
Stephen Though ‘it is a crazy idea that could never work’, I relish the thought. LOL
September 30th, 2008 at 12:23 pm
SED Let me see if I understand this correctly: The republicans voted against a bill that Americans are against 200 to 1 ( many congressman felt compelled to yield to their constituents cry to vote NO on the Bailout) and republicans are the bad guys. I am confused.
September 30th, 2008 at 1:14 pm
I agree with you Tracey that it is confusing.
It appears that the majority of americans do not want the bill to pass because they feel it is a bailout for greedy rich corrupt corporations; which is reasonable. In the last few months we have seen Bear Stearns, Lehman Brothers, AIG, Merryl Lynch, Washington Mutual, and Wachovia all fail and the Dow is still at around 11,000. There is a disconnect with the perception in Main street. There is also a lack of credibility from all of leadership.
Most americans did not think this was going to affect them. That was before the bill didn’t pass. The plummeting of the Dow yesterday was a wake up call to most people. We are quickly reaching the point of a credit freeze that will ultimately cost jobs and many people getting a paycheck cashed out of a bank.
We don’t want a bailout, because we don’t believe in leadership. Yet at the same time we recognize that something must be done before we are all ruined.
A “rescue plan”, as it is now properly called, will be passed this week. The alternative is clearly worse at this point.
The GOP is going to be blamed, because that is the national headline. Also, McCain is going to take the worst hit since the bailout has now become his baby. He was unable to wrangle up enough votes from his own party to vote for the thing. Thus questioning his leadership. Obama has been hands off and conveniently out of the line of fire.
September 30th, 2008 at 1:40 pm
The failure of the bailout bill is good news according to Jeffery Miron, an economics professor at Harvard.
“Clear Thinking from Jeffery Miron”
http://www.lewrockwell.com/blog/lewrw/archives/023223.html
September 30th, 2008 at 2:30 pm
Here is an article about the “Community Reinvestment Act” and how has led us into the mess we are dealing with today.
http://www.buffalonews.com/149/story/451501.html
September 30th, 2008 at 2:55 pm
Thanks for the link, Tracey.
Here is GREAT read!
Glenn Beck’s radio interview today with Jonah Goldberg (National Review Online editor-at-large, author new book ‘Liberal Fascism’):
“…crap sandwiches as far as the eye can see…”
Barney Frank’s name comes up… Yeah, go after this guy!
http://www.glennbeck.com/content/articles/article/196/15838/
Also, Bill O’Reilly said during Beck’s radio interview with him today that he (Bill) was targeting Barney Frank tonight. It’s about time someone comments on the audacious hypocrisy of this guy!
http://www.glennbeck.com/content/articles/article/196/15840/
GLENN: Why is no one in the media holding Charlie Rangel’s or Barney Frank’s to the fire?
O’REILLY: I’m going to take care of Frank tonight. That’s our target tonight. Look, I said from the very beginning it’s bogus and it is and there’s enough blame to go around for everybody.
GLENN: Yep.
O’REILLY: But Frank has now stepped over the line. I’m going to have to deal with him tonight. I’m not going to tell you what we’re going to do but Frank gets his tonight. He is in the No Spin Zone.
September 30th, 2008 at 3:44 pm
As a strong believer in the free market I am pleased to see the current form of the bill fail. However, I’ve come to the realization that the leadership in Washington during an election year will muscle anything through to save their jobs. In my opinion, hopefully they make some improvements to bad bill since it appears to be inevitability.
September 30th, 2008 at 5:13 pm
SED, You’ve got it right. Effectively, Uncle Sam bought AIG for 10 cents on the dollar. If AIG digs itself out of the hole it’s in, the taxpayers own warrants to participate in any upside. It’s possible we might actually turn a profit on this bad boy!
September 30th, 2008 at 7:29 pm
I wish Americans would hold out for a more conservative solution.
September 30th, 2008 at 11:09 pm
I got this email from my friend.
I love the idea!
I’m against the $85,000,000,000.00 bailout of AIG.
Instead, I’m in favor of giving $85,000,000,000 to America in
a ‘We Deserve It Dividend’.
To make the math simple, let’s assume there are 200,000,000
bonafide U.S. Citizens 18+.
Our population is about 301,000,000 +/- counting every man, woman
and child. So 200,000,000 might be a fair stab at adults 18 and up..
So divide 200 million adults 18+ into $85 billon that equals $425,000.00.
My plan is to give $425,000 to every person 18+ as a ‘We Deserve It Dividend’.
Of course, it would NOT be tax free.
So let’s assume a tax rate of 30%.
Every individual 18+ has to pay $127,500.00 in taxes.
That sends $25,500,000,000 right back to Uncle Sam.
But it means that every adult 18+ has $297,500.00 in their pocket.
A husband and wife has $595,000.00.
What would you d o with $297,500.00 to $595,000.00 in your family?
Pay off your mortgage – housing crisis solved.
Repay college loans – what a great boost to new grads
Put away money for college – it’ll be there
Save in a bank – create money to loan to entrepreneurs.
Buy a new car – create jobs
Invest in the market – capital drives growth
Pay for your parent’s medical insurance – health care improves
Enable Deadbeat Dads to come clean – or else
Remember this is for every adult U S Citizen 18+ including the folks
who lost their jobs at Lehman Brothers and every other company
that is cutting back. Of course, for those serving in our Armed Forces!
If we’re going to re-distribute wealth let’s really do it…instead of trickling out
a puny $1000.00 ( “vote buy” ) economic incentive that is being proposed by
one of our candidates for President.
If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+.
As for AIG – liquidate it.
Sell off its parts.
Let American General go back to being American General.
Sell off the real estate.
Let the private sector bargain hunters cut it up and clean it up.
Here’s my rationale. We deserve it and AIG doesn’t.
Sure it’s a crazy idea that can “never work.”
But can you imagine the Coast-To-Coast Block Party!
How do you spell Economic Boom?
I trust my fellow adult Americans to know how to use the $85 Billion
We Deserve It Dividend more than I do the geniuses at AIG or in Washington DC .
And remember, The Davis plan only really costs $59.5 Billion because $25.5 Billion is returned
instantly in taxes to Uncle Sam.
September 30th, 2008 at 11:20 pm
oops!
Sorry guys, I didn’t read and notice that Stephen has already posted the same email…….
October 1st, 2008 at 8:26 am
I’m a little surprised the Stephen and CH posted the same post, esp. since the math is WAY off. $85 billion divided by 200 million is only $425. I sure can’t pay off my mortgage with that. Maybe, if we were all a little better at math we wouldn’t be in this mess. I sure knew I couldn’t afford a $300,000 starter house….
Sorry to disappoint.
$85,000,000,000/200,000,000
try the elementary trick of canceling zeros and you get
$850/2
October 1st, 2008 at 8:29 am
The current bailout bill has a provision that would allow the US to bailout foreign banks. What is up with that?
Please tell your representatives to vote against this bill. We need to take more time to understand what is happening here.
October 1st, 2008 at 9:03 am
The Truth about the Bailout
http://market-ticker.denniger.net/
October 1st, 2008 at 9:46 am
Scannon:
The reason for the posting is to point out the absurdity of what is taking place and the posting (email making its way around the internet) is humor, not a serious solution.
Although it is worth noting that sometimes 1 + 1 does not = 2. (try adding raindrops)
For example, consider the reality
of why Paulson wants 750 billion? 750 billion seems like a tidy number. Does it add up? Is it enough, or a short term (30 day) bridge? With 7 trillion of questionable debt floating around what will aid in fixing (for a time) this crisis?
What with the 600 billion + the 200 billion already shot into the system . . . do the calculations. Does it add up?
October 1st, 2008 at 11:18 am
Stephen
Did you read “The Truth about the Bailout”
What do you think?
Does that seem a little weird that we would be rushing to buy up there debt?
I wish we could slow down here and give the American people time to see what they are voting for.
I am not here to create bad feelings. I just feel the need to create awareness. Thanks
October 1st, 2008 at 3:39 pm
Who do you think backs America’s debt?
October 1st, 2008 at 4:16 pm
Tracey,
I do not know exactly what the solution is, nor do I understand all the aspects of the bail out. Obviously politics is playing a significant role that is skewing the outcome for better or worse.
Of course, I am concerned with how easily, or quickly, a few hundred billion dollars is tossed around, however, if the credit crisis is as serious as many do believe, then it may indeed impact the economy for some time.
I know back in June things were already tightening when an equity group I work with was purchasing a shopping mall. The debt to equity ratio had risen much more than we had anticipated. So we had been aware that something would shake out. Of course, I didn’t and nor did anyone else I work with know of the scale or impact.
I guess we will wait and see the final outcome and who wins the day, politically. One thing I do believe will occur with a government bailout or solution is that more regulations could create a situation that causes another crisis of some sort down the road. Enron provided a direct link to some of the things we are witnessing, now.
The question is how much time does the market have before things fall apart, or do they indeed remain static, unaffected by the credit crunch and money supply?
October 1st, 2008 at 5:18 pm
Some 200 leading economist to not think this plan will work.
They do how ever agree that some thing needs to be done and there are options available to us but congress is fixated of Paulson plan and he said he would reject any plan that included a provision to restrict the purchasing of foreign debt.
I think this plan will pass because many Americans think this is the only way. But I believe the 200 economist who say there are other ways to fix this problem.
Bills are hard to get changed. I wish America would slow down because I do believe the economist when they say we have time to work out a better plan.
October 1st, 2008 at 5:55 pm
Stephen,
In an answer to your question “How much time does America have before things fall apart?” I consulted my Husband Greg and he said “It is hard to guage the reaction to the bailout. It will initially stabilize the market.” If you agree with what the leading economist are saying the bailout will not stabilize the markets for long term. Company’s will be reporting lower earnings and the markets will go down over the next couple of months. In the event that the US economy gets going again, interest rates will rise because the US government is in record debt and that will cause other problems within the economy and affect the stock market.
This is my husbands prediction and HE COULD BE WRONG but it is here for your consideration. Markets will go down in a panic in the middle of Oct., then it will bounce back and then it will go down over the next year based on the fact that the economy will go into a major recession.
Thanks Stephen- Best Wishes in all your financial endeavors. America is in for a rough ride.