The misery worsened on Wall Street Tuesday, with stocks piling on losses late in the session and bringing the two-day decline in the Dow Jones industrials to more than 875 points amid escalating worries about credit markets and the financial sector.
The Dow lost more than 500 points and all the major indexes slid more than 5 percent. The Standard & Poor’s 500 index saw its first close below 1,000 in five years.
Steps by the Federal Reserve to reinvigorate the dormant credit markets ultimately weren’t enough to calm nervous investors. News about financial companies only added to their despondent mood.
“The calls I’m getting — every money manager I deal with, and every client I talk to — are just very emotional. This is a very, very emotional time, and most of them are taking steps to shore up their defenses, reducing exposure to stocks just to defend their portfolios,” said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors.
In other news, the Fed will now loan money to commercial enterprises directly.
Iceland is begging Russia for for a loan because no one else will give them one.
And Spain is begging people to turn in all their cash money. This has a risk of backfiring. Around these parts if the the Government started begging people to turn their money in people might start to pull their money out just to be on the safe side.