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Stocks tumbled Monday, as investors seemed to lose confidence that the eurozone latest plan to stem its debt issues would work.
According to preliminary calculations, the Dow Jones industrial average fell 162.49, or 1.33 percent, to 12,021.77. The S&P 500 finished 18.67 lower, or 1.49 percent, to 1,236.52. The Nasdaq slid 34.59, or 1.31 percent, to 2,612.26.
Stocks plunged from the start of trading Monday after two big rating agencies criticized a fiscal pact hatched at last week's summit of European leaders aimed at ending the region's debt crisis.
Fitch Ratings said at midday that the deal to bind Europe's budgets more closely made little difference. Fitch predicted that the region would face "a significant economic downturn" as it wrestles with the sovereign debt crisis, which may last "throughout 2012 and probably beyond."
Moody's Investors Service said earlier in the day that it will review the credit ratings of every European Union nation in the first quarter of next year. The statement doused optimism among investors that had lifted stocks and other risky assets late last week.
The summit produced "few new measures" and Europe remains in a "critical and volatile stage," Moody's said in a published report. It noted that the pact does not address Europe's immediate problem: the crushing debt loads of some nations and their rising borrowing costs.
The plunge follows a strong rally last week as many investors began to believe the eurozone was finally getting a handle on the crisis.
“It looks like a reversal out of what was, from my standpoint, unwarranted optimism on Friday,” Keith B. Hembre, the chief economist and chief investment strategist at Nuveen Asset Management, told the New York Times. “It is a little bit of a puzzle as to why the market tends to act so euphoric going into these meetings only to act so disappointed.”
The Associated Press contributed to this report.
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Up, Down, Up, Down, Up, Down, OH my neck is hurting. Think I will have another gin and tonic, and remember I am into Investment grade corporate bonds. Now I can get a good nights sleep. Sorry Wall Street.
Sleep well--------------------but you are making a pittance!!
The situation is hopeless. For many decades, due to FED's easy money policy, Americans have borrowed and spent. This inflated the money supply, prices and salaries (inflation). But now borrowing has stopped. We ran out of borrowers. M3, which is broad definition of money supply, is deflating. With a deflating money supply it is not possible to pay the same salaries in the economy. For example, with money supply of 50 trillion, if avarage salary is 50K USD, when the money supply falls to 40trillion, average salary will have to fall to 40K. This is the reason why we have unemployment. State and local governments are going bust. Their programs, pension plans were built based on an inflated money supply. When deflation hits, states, local governments have to cut back spending drastically, or declare bankcruptcy. And where are the stocks?? Still up and running. Google for "financial mania continues" to understand the stock market bubble we have.
No Heaveto, I am making 5-7% my friend!
Down today. Up tomorrow. Europe's burning to the ground today. Every thing solved tomorrow. These economic messes, here and in Europe, won't be solved in the short run. It's going to take several years of severe belt tightening to get out of them.
If you are manipulating the markets then you have to have good tangable stories for the movement--plus the fact how are you going to get the 'suckers' (as they used to be called --1940's) to jump in unless you give them a good juicy story???-----it is exciting stuff------but no room for 'weak stomachs."---I advise you to read about Jesse Livermore, the greatest trader that ever lived (1930's) he started life as a farm boy!! An American success story--they wrote the"Great Gatsby" based on his life!!
Actually they didn't fall far enough but I never look a gift horse in the mouth. I'll take it.
Don't worry wlockridge-----------keep your eye on the technicals, there is still some space for a little more downward movement----I am still "short"
What needs to be noticed here is that all these countries in the EU have tax rates considerably in excess of ours. If higher taxes were the answer to huge deficits, these countries should be rock solid. On top of significantly higher personal income taxes they also have a hefty VAT. It is not logical that dozens of countries are all in deficit debacles because they don't tax enough - the common denominator, here and abroad, is government spending. To contend that government would have spent less if they were given more money is simply ridiculous. Governments will spend every penny you allow them to take, and to suggest that if only we taxed more the situation would be different is just indefensible...
It isn't a case of "Government Spending"---it is "What the Government Spend the money on"----if you spend it on infrastructure then it creates jobs and helps the country--if you spend it on unnecessary war adventures, then it is wasteful-----to go from a balanced budget to trillilons in debt in 10 years is what I call STUPID spending-----don't you??-----and voting Dem. or Rep. has nothimg to do with the argument!!-----it is called common (or uncommon) sense.
Last Wednesday through Friday the technicals were screaming "DOWN"----so, I went short!!! and what do you think happened!!!------the only way speculators can make money is in volatility------so they make up stories from day to day--it used to be called (in the 1940's) "setting the street on fire" in the good old days of the "bucket shops"-----maybe they have another name for it today!!--------my advice is learn to read the technicals!!--exciting stuff!!
Even if Wall Street went up 1% a day till the end of the year it would barely break even for 2011. Investors are down 15% fo 2011 money wise. They have been set back to 2008. Actually i lost less money in 2008 than in 2011. Our financial system gave away the ship to Europe. Europe is laughing there ass off at Wall Street!!!
If there’s any intelligence left. ?
Tell Congress to hit the reset button. !
That’s assuming of course you know what we’re talking about. ! $$$$$$$
Let me spell it out for you.
Bring everyone down to the same playing field. from the very rich to the very poor.
Resetting the economies natural problems. (Man made)
In racing all national debt’s. spreading the wealth to everyone.$$$$$
You have permission to pass this on to be read aloud.
If there is any intelligence left.! this is the only resource we have available to us now.
tic, toc, kick the can, the snowball is rolling and growing as time passes - Then CRASH
test
Anyone looking at and making stock decisions day over day is an idiot and should remove themselves from the stock market. Its gotten too easy go access, and unfortunately now we're in this problem that everything revolves around the stock market. Yes, a speculatory industry that is nothing more than smokes and mirrors. We'd be in a much better position without the stock markets.
I think folks are just getting ready for the consumer season break...tying up loose ends and positions. It'll be pretty bland on the markets over the next few weeks and then the roller coaster'll be back in business for the New Year. Just remember to have your gold where you can get it. Merry Saturnalia to all and to all a good night!!