Stocks tumbled again during the final day of the week. The Dow lost 1.2% on the week while the Nasdaq eeked out a slight gain. It was a consumer sentiment drop that hurt stocks today as well as a profit warning from JC Penny.
The Dow fell 86 points to 12,216. The S&P 500 lost 10 points to 1,315. The Nasdaq gave up 19 points to 2,261. Crude oil prices dropped nearly $2 to settle at $105.62 a barrel.
Next week there will be a crucial jobs report that could send stocks falling if it is weak.
JPMorgan Chase & Co. agreed to buy Bear Stearns Cos. for $240 million, about 90 percent less than its value last week, after a run on the company ended 85 years of independence for Wall Street's fifth-largest securities firm.
Shareholders of Bear Stearns will get stock in JPMorgan equivalent to about $2 a share, compared with $30 at the close on March 14, the New York-based companies said in a statement late yesterday. The Federal Reserve is providing financial backing to JPMorgan, the second-biggest U.S. bank, and also cut the rate on direct loans to banks in its first emergency weekend action in almost three decades to stave off a broader market panic.
The Fed also moved in with a rare weekend move and dropped the emergency lending rate a quarter of a point.
President Bush also weighed in predicting a turnaround.
President Bush rushed to strike a note of calm to the turbulent situation on Monday morning, hailing the Fed's action and saying: "We've taken strong decisive action." The president spoke after meeting at the White House with Treasury Secretary Henry Paulson and other members of his economic team. "We're in challenging times," Bush said.
Despite all the action to help prevent losses stocks are still in negative territory again today. The Financial Timessays investors are waiting for the next domino to fall.
Gold traded at a record $1,000 an ounce for the first time today. The news coincides will the recession concerns, the weak dollar and the high price of oil. The BBC reports that since the beginning of 2008 gold has jump 20%. Gold also climbed 32% last year.
Since the beginning of the year the value of gold has increased by about 20%, after it rose 32% in 2007.
Gold eventually settled for the day at $993.80, up $13.30 an ounce.
Analysts say gold will stay high as long as dollar and growth fears remain.
"Every bit of bad US economic data boosts gold in two ways," said Fortis Bank.
"First because it reinforces the return of its role as a safe-haven asset, and second because the dollar falls on expectations of further Federal Reserve rate cuts."
A 52% climb in just twelve months might mean gold has climbed too quickly notes USA Today columnist John Waggoner here.
If you're hankering to buy gold, you may get a chance to buy it more cheaply in the next month or so. Gold bullion has soared 52% over the past 12 months and 19% this year — and it may have gotten ahead of itself. But if you want to invest for the long run in gold — which can have a role in a diversified portfolio — you have three good options: gold bullion coins, gold exchange-traded funds and gold mutual funds.
Then again, Waggoner's column also mentions that James DiGeorgia - editor of the Gold and Energy Advisor website - says gold could climb to $2,500 an ounce.
News that the Fed is going to provide additional liquidity for the credit markets help boost stocks to huge gains today The Dow scored its best one day percentage increase in 5 years according to Reuters. The Dow climbed 416 on the day and the Nasdaq was up 86 points.
At the same time cities are starting to feel the impact of the tough housing markets. There are more homeless people. There is more crime. There are less revenues for U.S. cites.
The mortgage foreclosure crisis has caused a drop in cities' revenues, a spike in crime, more homelessness and an increase in vacant properties, a survey of elected local officials out today shows.
About two-thirds of 211 officials surveyed by the National League of Cities reported an increase in foreclosures in their cities in the past year, according to the online and e-mail questionnaire. A third of them reported a drop in revenues and an increase in abandoned and vacant properties and urban blight.
"There's a reduction in revenues at the same time that more services are needed," says Cynthia McCollum, president of the National League of Cities and councilwoman in Madison, Ala., a suburb of Huntsville. "Because of foreclosures, people are stealing, crime is on the rise and we don't have more money for cops on the street."
The market had a boost today but the foreclosure crisis is worsening.
Yesterday's jobs report told a tale of weakness. The U.S. economy lost over 60,000 jobs in the short month of February and over 20,000 jobs in January. An AP article says the pink slips have increased and some economists hear the recession bell ringing.
The grim snapshot of the country's employment climate underscored the heavy toll the housing and credit debacles are taking on companies, jobseekers and the economy as a whole.
"It sounds like the recession bell is ringing for the U.S. economy, although it is still faint," said Stuart Hoffman, chief economist at PNC Financial Services Group.
On Wall Street, stocks tumbled. The Dow Jones lost 146.70 points, a little more than 1 percent to close at 11,893.69. The Dow was down 370 for the last two days of the week.
The worsening situation will prompt the Federal Reserve to cut a key interest rate deeply -- perhaps by as much as three-quarters of a percentage point -- at its next meeting March 18, or possibly sooner, to help brace the teetering economy, analysts predicted.
The shower of pink slips was widespread. Factories, construction companies, mortgage brokers, real-estate firms, retailers, temporary-help firms, child day-care providers, hotels, educational services, accounting firms and computer designers were among those shedding jobs. All those cuts swamped job gains at hospitals and other health care sites, bars and restaurants, legal services and the government.
President Bush was quick to reassure everyone that the economy is not in a recession. Bush said, "I know this is a difficult time for our economy, but we recognized the problem early and provided the economy with a booster shot. We will begin to see the impact over the coming months."
Less and less people are expecting the quick recovery that President Bush is. With the DOW falling under the 12,000 mark Friday next week could be a difficult one.
The DOW fell for the fourth straight day. It was down over 40 points. However, the NASDAQ managed to eek out a gain thanks to comments made by Cisco CEO John Chambers. With articles like this one mentioning the threat of stagflation it isn't surprising to see stocks falling.
Gold traded at a record $1,000 an ounce for the first time today. The news coincides will the recession concerns, the weak dollar and the high price of oil. The BBC 