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Market Blog - 5 Cents
Posted by: Paul Nichols

06 Dec 2007

I've decided to keep a running blog of the financial markets. We've seen quite a topsy-turvy week, and I thought it would be best to mark down this information for posterity's sake.


Monday, December 3rd


The Dow Jones industrials average fell 57 points as weakness in the financial and technology markets hindered growth. Notwithstanding, Activision rose 13% on news that it would sell a majority interest to Vivendi. Investors were also concerned that they didn't know anything about a rescue plan for the mortgage market. Use of passive verbs also subjected investors to uncertainty.


Tuesday, December 4th


The Dow Jones slipped 66 points even though there was news that the Federal Reserve would soon cut interest rates. Investors were worried about how much they would be cut, although everyone agreed that cutting the rate at all would be a good thing. The market was also hurt because Southwest Airlines reported that it would grow its business next year, but only by 5%, not 6% as previously reported. Regardless, Southwest shares still rose .5%.


Wednesday, December 5th


The Down Jones jumped 196 points despite news that crude oil dipped below $88 a barrel. The biggest driver of the market was news that the Federal Reserve might cut interest rates again, and that the federal government would help the economy pull out of the sub-prime mortgage debacle. All reports indicate that the sooner retailers start celebrating Christmas, the sooner the holiday stock market rally can begin. Look for holiday decorations in the stores around Grandparents' Day next year.


Thursday, December 6th


The Dow Jones jumped 175 points in spite of news that the government would bail out homeowners affected by the mortgage crisis. There was widespread skepticism that the bailout plan, which President Bush dubbed "not a bailout plan" because no buckets were being used, would be effective. The Dow also increased despite crude oil jumping to over $90 a barrel.


Okay, okay, the information I provide is mostly factual. There are omissions that skewer one's ability to determine why the Dow went up or down, but all the information I provide figured prominently in the market reports for the day. More important, actual market reports, which have a lot more information, provide mixed signals in the exact way my notes above do. Everything's relative, I suppose, but not everything's rational.

© 2007 Dime Brothers
Category: Finance/Business    

Reader Comments:

Upon receiving this report, investors nationwide turn in their sell orders on jitters about reporting.
06 Dec 2007
Rate Reduction
For 2 weeks leading up to the report yesterday, people were hoping for and expecting a rate cut (which would allow more lending by banks which would allow people to buy more stuff, and thus lead to business' earning more moolah). Stocks soared.

When the report comes in and people learn that the rate was cut, stocks plummeted.

People are always trying to stay ahead of the market, so it fluctuates a couple of days, weeks, or months ahead of schedule. Investing with a long-term outlook should be the way to go for us rookies.

(And this post is another excuse for me to test the new security images.)

: )
12 Dec 2007
Image Test

You just like to read yourself..
14 Dec 2007

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