Closing bell, closing year -- good riddance

Posted Dec 31st 2008 4:21PM by Douglas McIntyre
Filed under: After the Bell, General Motors (GM), Market Matters

The top U.S. indexes were up a little over 1% today. In a perverse way, it was good news. American markets are down almost 40% this year, and the Dow Jones Financial Index is off 55%.

It is nice to be able to say the numbers are in the books and that the year is over. The market does not work that way. December 31 does not look any different than January 5. The same issues are still on the table: No one will lend money; jobs are falling; real estate prices are off; earnings are terrible.

The government will keep dumping capital into the system. There are no reasonable predictions of whether the TARP or new Obama bailouts will work. The market will have to wait until the money is spent.

High oil prices hurt the economy badly early this year. Now they are down and won't go up. Even a violent battle in Gaza has not pushed crude up much. The fear of falling demand has overwhelmed that.

Perhaps one of the telling signs in today's trading was that General Motors (NYSE: GM) fell almost 16% to $3.20. GMAC, which GM still owns in part, got a $6 billion bailout yesterday. GM got its own bailout earlier in the month.

In this market, optimism does not last long.

The unofficial closing numbers:
DJIA: 8,776.39 +108.00 +1.25%
NASDAQ: 1,577.03 +26.33 +1.70%
S&P 500: 903.25 +12.61 +1.42%

Douglas A. McIntyre is an editor at 247wallst.com.

Tags: GM

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Reader Comments (Page 1 of 1)

12-31-2008 @ 5:25PM

42 said...

"No one will lend money"

Oh come on, I could go out and get a loan on a $50,000 car or 350,000 house tomorrow.

People with good credit, jobs, and low debt-to-income can get loans. We just choose not to do so at this time.

1-01-2009 @ 12:20AM

Chandler said...

Great comment. I agree. I liked on radio host and writer Kevin Price said on the subject at www.BizPlusBlog.com: "In the United States we have a safety net for the poor, we bailout the super rich, and we obliterate the engine that creates more than 80 percent of the jobs in the country through excessive taxation, regulation, and licensure law." This pretty much sums up the problems we will face due to these hand outs.

1-19-2009 @ 10:41AM

Leonard said...

Re the last commentor, you have just had 8 years of rule by your side, which passed multiple tax cuts and unregulated right and left .
If you're complaining now, you must be comparing the post-Bush US with some ideal world of totally laissez faire capitalism--some place and time kind of like the Gilded Age of America in the late-19th century. The growth was fast. The human misery was incredible for working people. No income taxes so the maximum possible amout of the resulting profits went into the pockets of the wealthy.
I guess that little matter of misery doesn't matter as long as we get the fast growth and the Rich getting better off, huh?