Hey Wait! Aren’t We Entering the Great Depression?
Posted on October 13, 2008
Hey, I’m not an economist, and I have no idea whether the bail out plans around the world will help or hurt things in the long run. They sound a little on the socialist side to me, but I’m no expert. I also have no idea if these plans have anything to do with today’s recovery or if the market corrected itself after finally finding a bottom. However, today’s stock market news has got to burst a bubble in all the chicken-little, panic button pushers screaming that we are about to enter the next great depression…you know, like Obama.
Oct. 13 (Bloomberg) — Stocks rallied worldwide, with the Standard & Poor’s 500 Index rebounding from its worst week since 1933, and oil climbed from a 13-month low after governments in Europe, the U.S. and Asia agreed to support banks.
Morgan Stanley surged 74 percent after changing terms of its $9 billion investment from Mitsubishi UFJ Financial Group Inc. UBS AG and ING Group NV gained more than 12 percent in Europe after the region’s leaders said they would guarantee bank debt. The euro rose the most in three weeks against the dollar and yen on speculation the bailout may prevent more bank failures.
“They brought out the heavy artillery,” said Aurore Wannesson-Raynaud, a strategist at Axa Investment Managers in Paris, which oversees about $830 billion. “It’s possible that the worst is behind us. We should see better days ahead.”
The S&P 500 rose 7.1 percent to 962.81 as of 1:50 p.m. in New York, its biggest rally since Oct. 21, 1987, and the Dow Jones Industrial Average gained 558.73 to 9,009.92, the largest point increase ever. Both gauges tumbled 18 percent last week. The MSCI World Index added 6.9 percent. Europe’s Dow Jones Stoxx 600 Index advanced 9.9 percent for the biggest daily gain ever. The MSCI Asia Pacific excluding Japan Index rallied 7.4 percent.
Stocks climbed after the U.S. Federal Reserve said central banks will offer financial institutions unlimited dollar funds and Europe pledged to guarantee bank debt issues and permit governments to buy stakes and recapitalize some distressed financial companies. All 10 S&P 500 industries gained more than 5 percent.
The Dow climbed 936, the biggest one day gain in 21 years!
Wall Street has stormed back from last week’s devastating losses, sending the Dow Jones industrials soaring a nearly inconceivable 938 points after major governments’ plans to support the global banking system reassured distraught investors.
The Dow by far outstripped its previous record for a one-day point gain, 499, reached during the waning days of the dot-com boom in 2000.The market was likely to have a rebound after eight days of precipitous losses that took the Dow down nearly 2,400 points, but no one expected this kind of advance. Still, back-and-forth trading is likely to continue as Wall Street still contends with a crippled financial system and a struggling economy. So some of Monday’s big gains may disappear when trading resumes Tuesday.
The Dow is up about 938 points at the 9,389 level. All the major indexes are up more than 11 percent.
But, I thought we were headed into a great depression! Someone please explain things to me.
If this rebound is real, and this wild swing isn’t followed by another crash…if this spike sticks and is followed by continued slow growth…when do we get our money back from the bailout? What, why are you laughing?
Time to climb down from the ledge?
» Filed Under 1st Amendment, Economy, Elections, Europe, News, Socialism
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5 Responses to “Hey Wait! Aren’t We Entering the Great Depression?”
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Wait… didn’t Sarah Palin say we were heading into another great depression?
Oh yea… lets just ignore that.
If you remember, the stock market rallied after Black Thursday, crashing again on Black Tuesday. I don’t think we’ve seen the caboose of this train yet. I expect wider and more expansive fluctuations now than then, in part due to advances in technology, the nature of the companies that make up the market, the expanded demographics of investors, and the global economy and interdependence of the world’s central banks and markets.
10/29/1929 Dow rallies 30% in 2 days. It’s called a dead cat bounce, it’s a fool’s rally…
Using it to try and disprove risks of a great depression makes no sense. It just shows how dangerously volatile things are.
Liberals are the ones who are biased they are the ones so radical and blind their stupid
Thanks for the interesting post! I just interviewed a 92 year old about life during the Great Depression for my blog People Are Amazing. You might find it interesting:
http://peopleareamazing.wordpress.com/2008/10/14/mr-crawfords-second-depression/