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There has been plenty of banter back and forth as to whether the Federal Reserve had lost some of its gusto. Can it have a significant impact given the massive scale of the global economy? Measured by the reaction of Wall Street investors today, the answer is a resounding yes.
Wall Street has finally found a reason for a big rally. The Federal Reserve plans to pump $200 billion into the financial markets to help ease the strain from the credit crisis. The Dow Jones industrial average is up about 416 points at the 12,156 level. That's the index's biggest one-day point gain since July 24, 2002. The NASDAQ closed up 86.42 to 2,255.76 and the S&P 500 finished the day at 1,320.65 gaining 47.28.
Among some of our more closely watched stocks Google Inc. (NASDAQ: GOOG) rallied to 439.85 Todays move by the Fed implies they had seen enough data, and stories like Dow below 12,000 -- do I hear 11,000? Yes I do! to be spooked into action. No one knows what tomorrow will bring but at least for today the Fed was Big Time again!
+26.23 (+6.34%), Apple Inc. (NASDAQ: AAPL) climbed 127.39 +7.70 (+6.43%) Microsoft was up 29.30 +1.25 (+4.46%), Amazon.com (NASDAQ: AMZN) rose 67.15 +3.68 (+5.80%), Goldman Sachs (NYSE: GS) moved up to 163.07 +7.49 (+4.81%), eBay (NASDAQ: EBAY) grew to 26.41 +0.69 (+2.68%), and General Electric (NYSE: GE) was up to 33.40 +1.70 (+5.36%).
Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own EBAY and do not own any of the other stocks discussed.
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Reader Comments (Page 1 of 1)
3-11-2008 @ 6:12PM
Andrew said...
See the Federal Government is not all that bad people. Sure they sit back and tax us to death but when they see that thier personal financial assets are affected as well in addition to all of the horrible reports of losses, they said ok enough is enough lets do something. You can't get that in Mexico or Cuba! LOL
3-11-2008 @ 6:23PM
Sheldon L said...
...and wait until we see the rampant inflation that will follow Andrew -- just like any third world nation. That is unless we see a miraculous increase in productivity...not holding my breadth.
3-11-2008 @ 10:42PM
john said...
If this countries (politicians) managed our money like american families) have to handle our own money we would all be soo much better off! Please don't ever vote for anyone that does not demand a balanced budget:(:(:(
3-12-2008 @ 5:30AM
Jack H said...
DEAD CAT BOUNCE ?
3-12-2008 @ 11:18AM
gumby said...
Where the Fed found $200 billion?? Easy... justask Wall Street to dump stocks and keep them there . Shareholders are stuck with paper losses while Wall Street hand the money to Fed to loan to Banks while shareholdr are holding the stocks for indefinite time.. Which stocks , no one knows..
3-12-2008 @ 11:18AM
gumby said...
Google is certainly one of them.... It came down by 300 points in a few months ... It might yields a few tens of billions to the Fed and it helped a lot ... Google investors probably wont see Google go back up for years... Same happend to Intel, and those biggies... Brokers sell stock to you and hand your money elsewhere not always to the sellers of your stocks... That is how the Fed find money to lend .... One of those dirty ways.. Wall Street is like a money funny house with all those crazy mirrors...