Last week the US stock market delivered the most dramatic losses and gains since 2002. For the week, the S&P 500 gained 0.3%. Substantial changes have occurred, however, in the fundamental financial system of the United States.
Read MoreStock futures reacted poorly to the news that Lehman would not be purchased either by Barclays Bank or Bank of America and would instead enter bankruptcy.
Read MoreAugust delivered a modestly positive month for stocks, which have been down 7 of the last 11 months since stocks peaked in October 2007.
Read MoreIn July, credit woes extended to the strongest participants in housing finance - Fannie Mae & Freddie Mac. Fannie Mae (originally Federal National Mortgage Association) was established as a "government sponsored entities" (GSE's) in 1938 to help Depression era homeowners to obtain mortgages
Read MoreLast month, we wondered whether the solid recovery from the March lows was the calm after the storm, or the eye of the hurricane.
Read MoreOf the dozens on economic reports we receive each month, many, particularly consumer and business confidence, were hitting lows not seen since the 1991 recession.
Read MoreWith each passing week, March 17th looks more and more the bottom of the current stock market bear market (peak to trough, the S&P 500 fell 19.7%, the NASDAQ and most international indices fell over 20%).
Read MoreThrough March 31st, S&P 500 declined 9.4% YTD and the NASDAQ declined 13.9%. Stocks looked into the abyss on March 17th.
Read MoreThe S&P 500 declined 9.1% since year end and the NASDAQ declined 14.2% over the same period. The 75% S&P 500/25% Lehman Government Bond Index lost 6.3% over the same period.
Read MoreThe news of the month was an "emergency" cut of 0.75% in the Fed Funds rate on January 22nd, followed by an additional 0.50% cut on January 30th, for a total of 1.25% in a week. This is the largest reduction in the Fed Funds rate ever.
Read MoreSince our commentary of last week, US and world stocks markets slid another 5% on average, taking most to within a percent or two of the official definition of a bear market (a decline of 20% from the previous peak).
Read MoreAs of last week, the US stock market is officially in correction (defined as a decline off 10% or more from a previous peak.
Read MoreThe modest 5.5% gain in the S&P 500 for the year disguised the slaughter in financial services (down 18.5%) and consumer discretionary (down 13.2% - primarily home builders and cars, but also retail).
Read MoreBy the end of October, we thought that the worst of the sub-prime crisis was behind us as many of the aggressive lenders (Countrywide, American Home Mortgage) in this space had already hit the wall.
Read MoreFrom a near record close on October 31st, the S&P 500 plunged 6.1% QTD, mostly in the last 24 hours. Hardest hit are the financial service stocks, with notables such as Citigroup down 29.5% QTD, Merrill Lynch down 25.1%, Freddie Mac down 23.9% and two of our long time favorites AMBAC down 60.8% and MGIC Investment Corp down 42.2% QTD.
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