http://voices.washingtonpost.com/livecoverage/ 15 en Copyright 2008 Mon, 13 Oct 2008 18:33:24 -0500 http://www.movabletype.org/?v=4.21-en http://blogs.law.harvard.edu/tech/rss Earlier today, we asked our readers: "Do you think the turnaround has begun?' So far, 61 readers have replied. The overwhelming majority answered -- either verbosely or succinctly -- "no." There was some cautious optimism sprinkled in among the comments, which you can see here. But by and large, most of you do not trust that today's Wall Street rally was the beginning of a real economic turnaround. Here are your greatest hits, some of which we've edited and condensed: Does the math; it looks bad: -- "At 8,000 the market was close to being right-priced. At 9,000 the Dow is overpriced. The market will hit bottom during summer of 2009. The sub-prime foreclosures should peak by summer of 2009 since most of the sub-primes were taken out between 2004 and 2006. Those on 2/28 mortgages have seen their adjustable rates reset which means those most likely to default bought http://voices.washingtonpost.com/livecoverage/2008/10/its_not_a_turnaround.html http://voices.washingtonpost.com/livecoverage/2008/10/its_not_a_turnaround.html business Mon, 13 Oct 2008 18:33:24 -0500 Today's rally -- with 15 minutes left in the trading day, the Dow, the Nasdaq and the S&P 500 all are up 9 percent -- is generally across the board, sector-wise. Advancers on the New York Stock Exchange outpaced decliners by about 2,900 to 250. Three of the five most active stocks on the exchange are from the financial sector -- Morgan Stanley, Bank of America and Citi -- with AIG and GE rounding out the top five. Morgan Stanley was on pace for its biggest percentage gain of the day, after cinching the Mitsubishi deal, but that's partly because Morgan lost 60 percent of its value last week on fears the Japanese would pull out. On the Nasdaq, both Apple and Microsoft are in the top five movers. In a sign of increasing investor confidence, gold futures -- considered a safe-haven investment -- have dropped for the third straight http://voices.washingtonpost.com/livecoverage/2008/10/todays_surging_stocks.html http://voices.washingtonpost.com/livecoverage/2008/10/todays_surging_stocks.html business Mon, 13 Oct 2008 15:54:34 -0500 Determined to keep the campaign spotlight on the economy, Sen. Barack Obama (D-Ill.) has added $60 billion in new tax breaks and other benefits to his economic stimulus plan and will urge Congress to act quickly after the election to provide middle-class relief, The Post's Shailagh Murray and Paul Kane report from Toledo, Ohio. While his opponent, Sen. John McCain (R-Ariz.), has reportedly considered but not yet spelled out additional economic recovery steps, the Democratic nominee is expected to outline several new proposals at a speech here this afternoon. They include: A temporary tax credit for firms that create jobs in the United States. Penalty-free 401(k) and IRA withdrawals through 2009, to allow struggling families to withdraw up to 15 percent of their savings, up to $10,000. A 90-day foreclosure moratorium for homeowners making "good-faith efforts" to keep up with their mortgage payments. Creating a new entity to lend to http://voices.washingtonpost.com/livecoverage/2008/10/obama_heres_my_economic_plan.html http://voices.washingtonpost.com/livecoverage/2008/10/obama_heres_my_economic_plan.html business Mon, 13 Oct 2008 15:02:17 -0500 One thing has been clear all along about the $700 billion Wall Street rescue-bailout: Someone would make money on it. That started today. Treasury just issued a statement saying it has hired Chicago investment consulting firm Ennis Knupp and Associates to advise on the implementation of the bailout/rescue plan. The contract will last for one year and pay Chicago-based Ennis Knupp $2,495,190. Here's a copy of the contract. Treasury said Ennis Knupp was chosen from among three bidders. -- Frank Ahrens http://voices.washingtonpost.com/livecoverage/2008/10/treasury_pays_firm_25_million.html http://voices.washingtonpost.com/livecoverage/2008/10/treasury_pays_firm_25_million.html business Mon, 13 Oct 2008 14:50:25 -0500 In remarks just concluded, House Speaker Nancy Pelosi (D-Calif.) touted the need for a relief package to aid taxpayers, as opposed to the $700 billion bailout/rescue plan aimed at Wall Street. "We're in a time when we need to tighten our belts," Pelosi said. "We need to take ourselves into survival mode." A similar relief plan was passed by the House earlier this year but killed by the Senate ahead of a promised presidential veto. The earlier relief bill included some $60 billion for new job creation; Pelosi said its reanimation would be similar in scope. But Pelosi said that recent events have changed the landscape and made it more likely a relief package could pass. Pelosi could have been referring to the last week's Worst Week Ever on Wall Street. Or she could have been referring to Sen. Barack Obama's (D-Ill.) 10-points-and-surging lead in the presidential race over Sen. http://voices.washingtonpost.com/livecoverage/2008/10/pelosi_us_in_survival_mode.html http://voices.washingtonpost.com/livecoverage/2008/10/pelosi_us_in_survival_mode.html business Mon, 13 Oct 2008 13:01:50 -0500 U.S. regulators are preparing to expand their response to the financial crisis beyond the $700 billion bailout package that was approved by Congress and signed into law earlier this month, sources familiar with the matter said today. An additional plan is set to be announced soon, most likely tomorrow morning, the sources said on the condition of anonymity because they were not authorized to speak publicly. Some of the sources said they expect the plan would go beyond the bailout by taking steps to shore up interbank lending, bank health as well as possibly expand deposit insurance beyond the current $250,000. Treasury Secretary Henry M. Paulson Jr. and Federal Reserve Chairman Ben S. Bernanke will hold a conference call with the chief executives of the nation's largest banks at 3 p.m. today to brief them on the plan. Treasury declined to be specific, but in a statement the department said, http://voices.washingtonpost.com/livecoverage/2008/10/us_regulators_prepare_to_move.html http://voices.washingtonpost.com/livecoverage/2008/10/us_regulators_prepare_to_move.html business Mon, 13 Oct 2008 12:43:22 -0500 http://voices.washingtonpost.com/livecoverage/2008/10/do_you_think_the_turnaround_ha.html http://voices.washingtonpost.com/livecoverage/2008/10/do_you_think_the_turnaround_ha.html business Mon, 13 Oct 2008 12:20:29 -0500 Sovereign Bank, a regional lender based outside Philadelphia that is struggling to survive mortgage-related losses, is discussing selling itself to Spanish banking giant Banco Santander, both sides confirmed this morning. The talks are in an "advanced" stage, Sovereign said. The terms remain unclear, but Santander is unlikely to pay a large premium for Sovereign, whose stock has fallen 67 percent this year. Sovereign shares were trading below $4 this morning. Santander, the largest bank in Spain, already owns about a quarter of Sovereign. Buying the rest would give Santander a large beachhead in the Northeast, where Sovereign operates about 750 bank branches. Santander had little exposure to the U.S. mortgage market and has emerged as one of the strongest international banks. Sovereign has lost a lot of money on bad mortgage loans, but it was also badly damaged by the collapse of Fannie Mae and Freddie Mac. Sovereign owned more http://voices.washingtonpost.com/livecoverage/2008/10/sovereign_in_talks_with_spanis.html http://voices.washingtonpost.com/livecoverage/2008/10/sovereign_in_talks_with_spanis.html business Mon, 13 Oct 2008 11:47:14 -0500 Treasury Secretary Hank Paulson will meet with the heads of the top U.S. banks in Washington and by phone today at 3 p.m., as a plan moves forward for the federal government to invest directly in banks, nationalizing them to a degree in an attempt to stabilize them. Also, Italian Prime Minister Silvio Berlusconi said that top officials in Europe will meet at the same time today to begin "concretely implementing" the financial relief plans made Friday by the G-7. -- Frank Ahrens http://voices.washingtonpost.com/livecoverage/2008/10/paulson_to_speak_with_top_us_b.html http://voices.washingtonpost.com/livecoverage/2008/10/paulson_to_speak_with_top_us_b.html business Mon, 13 Oct 2008 11:43:38 -0500 In a joint statement just concluded with visiting Italian prime minister Silvio Berlusconi in the White House Rose Garden, President Bush said that these are "tough times for our economies, yet we can be confident we can work our way though these challenges." Italy has been a U.S. ally in the wars in Afghanistan and Iraq and maintains troops in each. Through in interpreter, Berlusconi said Italy will stand with the United States in working through the global financial crisis. "The U.S. has taken over responsibility for taking care of the world," Berlusconi said. The stock market stayed aloft during Bush's remarks, unlike during some of his previous addresses. -- Frank Ahrens http://voices.washingtonpost.com/livecoverage/2008/10/bush_tough_times_for_our_econo.html http://voices.washingtonpost.com/livecoverage/2008/10/bush_tough_times_for_our_econo.html business Mon, 13 Oct 2008 11:24:58 -0500 President Bush is scheduled to address the press in a few moments (at 10:55 a.m.) with Italian Premier Silvio Berlusconi. Presumably, Bush will make some remarks on the economy and the bailout package being readied. As a bit of spectator sport, take a look at what the markets do as Bush speaks. They're currently in a strong rally -- as of about 10:45 a.m., the Dow was trading up 460 points. -- Frank Ahrens http://voices.washingtonpost.com/livecoverage/2008/10/bush_to_speak_shortly_watch_ma.html http://voices.washingtonpost.com/livecoverage/2008/10/bush_to_speak_shortly_watch_ma.html business Mon, 13 Oct 2008 10:47:57 -0500 Like bulls behind a gate snorting to escape, stocks roared out at the opening bell moments ago. In the first few minutes of trading, the Dow is trading up 400 points, or more than 4 percent, and rising. The S&P 500 and Nasdaq also are trading up more than 4 percent. But is it a) sustainable and b) meaningful? We won't know the answer to a) until today's close, but we can learn something about b) by watching volume throughout the day. If volume is light, it's mostly a symbolic rally. We'll keep an eye on it. -- Frank Ahrens http://voices.washingtonpost.com/livecoverage/2008/10/stocks_rally_at_opening.html http://voices.washingtonpost.com/livecoverage/2008/10/stocks_rally_at_opening.html business Mon, 13 Oct 2008 09:39:08 -0500 The bond markets take the Columbus Day holiday today, but the stock markets do not. Will this be the day the markets push off the bottom of the pool and try to get above water? There are good signs. As The Post's Zach Goldfarb reported earlier, the Asian markets have rallied and the Wall Street futures (a good prediction of how stocks will trade when the markets open at 9:30 a.m.) are trading higher. Morgan Stanley has closed its deal with Mitsubishi UFJ Financial Group in which the Japanese firm gets a 20 percent stake in Morgan for $9 billion. News of the deal is pushing Morgan Stanley futures up. Morgan shares lost 60 percent of their value last week on worries that the Japanese would pull out. Treasury continues to work on its comprehensive rescue plan that may be modeled on the European plan, CNBC reports, in which the http://voices.washingtonpost.com/livecoverage/2008/10/the_bond_markets_take_the.html http://voices.washingtonpost.com/livecoverage/2008/10/the_bond_markets_take_the.html business Mon, 13 Oct 2008 09:24:24 -0500 The head of the government's $700 billion financial rescue plan said that officials are assembling a "tool kit" of methods to implement the program, including investing money directly into banks and buying individual mortgages from them. Staff writer Peter Whoriskey reports on the 8 a.m. speech by Neel Kashkari, interim assistant secretary for financial stability. Kashkari said a team is being assembled and hopes to move quickly to improve conditions that have left the country's credit markets "extremely impaired." Among the measures Treasury is working on is a plan to purchase mortgage backed securities, to purchase whole loans from banks, and to insure "troubled assets," as well as a plan to purchase an equity stake in some institutions. Read the full story and the speech. http://voices.washingtonpost.com/livecoverage/2008/10/treasury_lays_out_plan_to_impr.html http://voices.washingtonpost.com/livecoverage/2008/10/treasury_lays_out_plan_to_impr.html business Mon, 13 Oct 2008 08:40:59 -0500 Welcome to the Week After. U.S. stock markets fell their most ever last week while officials around the world grasped for solutions to stem a financial panic. It looks like there may be a respite today, though with the kind of volatility we saw last week, we never know. Asian markets closed up significantly, while shares in Europe are also trading higher, with major indexes up five to six percent. U.S. markets are also pointing up. The Dow Jones Industrial average futures are up 4 percent, and the S&P 500 futures are up 5.15 percent at 7:15 a.m. Many traders are taking the day off because of Columbus Day. Overseas markets rose after officials in Europe took steps to rescue their banking sector. Britain announced this morning that it would spend $63 billion to recapitalize struggling banks, taking equity stakes in the firms. The announcement followed declarations by governments around http://voices.washingtonpost.com/livecoverage/2008/10/stocks_looking_up_on_bank_plan.html http://voices.washingtonpost.com/livecoverage/2008/10/stocks_looking_up_on_bank_plan.html business Mon, 13 Oct 2008 07:36:29 -0500