Tuesday, September 30, 2008
Despite the gloom and doom efforts by the Bush administration to frighten Americans into thinking the sky would fall if the House failed to approve his $700 billion dollar bailout of Wall Street criminals, U.S. stock indexes opened high, suggesting Monday’s sell off was an overreaction. The percentage decline was far less severe than the 20-plus-percent drops seen in the stock market crash of October 1987 and before the Great Depression.
In fact, Wall Street snapped back Tuesday after closing down 777 points yesterday, to close Tuesday up 485 points — nearly erasing yesterday’s loses as the market attracted millions of bargain hunters.
Although credit remain tight, there were a number of bright spots:
• The Standard & Poor’s 500 recovered 58.34 or 5.27 percent
• The Nasdaq composite index rose 98.60, or 4.97 percent
• The blue-chip index rose nearly 500 points by late Tuesday afternoon
• The yield on the 3-month Treasury bill rose Tuesday to 0.89 percent
• The yield on 10-year Treasury note rose to 3.83 percent
• An uptick in Inter bank lending increased although at a slightly high interest rate
• Ireland agreed to guarantee bank deposits to improve banks’ access to international funds
• The U.S. dollar jumped 1 percent against the yen
• The Euro fell to $1.4416 making travel to Europe more affordable for Americans
Although I am diametrically opposed to the $700 billion dollar bailout of Wall Street criminals, I agree completely with Sen. Barack Obama, who today proposed raising the Federal deposit insurance (FDIC) limit to $250,000 in an effort to help restore wavering public confidence in the American financial system. The FDIC was created by the Glass-Steagall Act of 1933 which guarantees the safety of checking and savings deposits in member banks up to $100,000 — an amount considered by many to be far too low.