Maybe the market needs a day of rest

Posted Mar 21st 2008 10:25AM by Jonathan Berr
Filed under: Economic Data, S and P 500, DJIA, Federal Reserve

Today the market is closed for Good Friday. Maybe the market can use the day off.

The market is bipolar. Rising from stratospheric highs to crushing lows at the flick of a switch. Mind you, sometimes it takes a big event to turn the market on and off and sometimes it doesn't take much of anything. That's what makes the market so maddening to follow.

Bloomberg News argues that the market's reaction indicates that Federal Reserve Chairman Ben Bernanke's strategy of aggressive interest rate cuts is working since commodity prices had a huge sell-of this week.

"The Standard & Poor's 500 Index posted its first weekly gain in a month, and the dollar leapt from its lowest level since 1973 after the Fed stepped in March 16 to rescue Bear Stearns Cos. (NYSE: BSC), the fifth-largest U.S. securities firm, and expanded its role as lender of last resort to embrace the biggest dealers in Treasury notes," the news service reported. "The Reuters/Jefferies CRB Index of 19 commodities tumbled 8.3 percent this week, the most since at least 1956, after touching a record on Feb. 29."

But any rejoicing may be premature. Consumer confidence remains shaky amid continued worries about the real estate market. Applications for unemployment benefits soared to their highest level in nearly two months, according to the Associated Press. In short, there is plenty to worry about.

The trick for investors is not to panic and do anything rash. Markets aren't volatile forever and do eventually sort themselves out. Getting to that point may cause quite a lot of pain in the meantime.

Tags: ben bernanke, BenBernanke, bsc, featured, federal reserve, FederalReserve, inthenews, nasdaq, nyse, the fed, TheFed

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Reader Comments (Page 1 of 1)

3-21-2008 @ 4:41PM

arthur said...

I tell you this, The market will drop still. all the money the gov, put into to banks for the morg, crices to help the middel class and the poor to remorg, to a fix and lower rate will never hapen, the banks need it themselfs because there in troubel themselfs. and to help bailout B&S and give JP Morgen the uper hand to buy at 2.00 a/s only to offer 6.00 a/s only because empolyees made a big stink.
that should show you the greed JPMorgen has, they made bils,this deil. Ill tell you this, the other banks better watchout, OIL, will runout sooner then pople think,and by magic we have sintha,fuil.thats why its so high,there looking to make more money befor the end,and i dont blamthem, they should realy get 500.Bar, then youll see people consurve, on gass,elt,heating,trav,by air,boats and so on,then youll have healthy people, thell lose pounds walking,rideing bikes,and so on,no more obese people . now for why 9 days ago the markets up 416pt, the gov bailout to banks &morg, inst, that fooled the little people into buying into the market,now they lost there money. OIL. my coment befor. DOLLER, spend little, and more wisley.and dont use your credetcards.and dont buy any big ticket items were you have to fin,.
WHY THE MARKET IS GOING NOWERE.
13 thats a unlucky # its coused by the houseing market,forclosers,hi arms,and the low ecq,in the house.

BEN BERNAKE, you cannot stop a runaway train, the banks,morg, co will have to bail out those people,like they were told to do,not to bail out themselfs,and stockholders. so that his spoon of suger is not working.