Good Afternoon Folks!
Stocks continued their slide today during a volatile session that saw the DOW briefly drop below the 2002 lows before bouncing slightly on the close.
Stocks rallied of the lows when The White House came out and announced that the banks would not be nationalized:
"WASHINGTON (AP) -- The White House on Friday insisted it's not trying to take over two ailing financial institutions, even as stocks tumbled again. On Wall Street, talk of nationalization of Citigroup Inc., and Bank of America Corp., prompted investors to continue to balk, worried that the government would have to take control and wipe out shareholders in the process.
Citigroup fell 20 percent, while Bank of America fell 12 percent in afternoon trading but also came off their lowest levels.
"This administration continues to strongly believe that a privately held banking system is the correct way to go, ensuring that they are regulated sufficiently by this government," White House press secretary Robert Gibbs said when asked about nationalizing the banks.
"That's been our belief for quite some time, and we continue to have that," Gibbs said.
Investors have shown decreasing confidence that U.S. banks can right themselves. Citigroup and Bank of America have already received significant help from taxpayers as the government has rushed in to try to save the financial sector, which has been choked by bad assets and seen the flow of credit shrink."
This was quite a change from what Senator Dodd said earlier in the day:
"Feb. 20 (Bloomberg) -- Senate Banking Committee Chairman Christopher Dodd said banks may have to be nationalized for “a short time” to help lenders such as Citigroup Inc. and Bank of America Corp. survive the worst economic slump in 75 years.
“I don’t welcome that at all, but I could see how it’s possible it may happen,” Dodd said on Bloomberg Television’s “Political Capital with Al Hunt” to be broadcast today. “I’m concerned that we may end up having to do that, at least for a short time.”
Bank of America and Citigroup, which received $90 billion in U.S. aid in four months, tumbled as much as 36 percent today on concern they may be nationalized. The Obama administration today said a “privately held” banking system is the “correct way to go” and House Financial Services Committee Chairman Barney Frank said nationalization ought “to be avoided.”
I gotta say it: WTF!
What a total cluster****! Whats it gonna be guys? The White House needs to at least have all of their own party on the same page as they try and fix the banking crisis.
Hellloooo....This confusion is not instilling confidence fellas!!!! This whole monstrosity has become a complete PR disaster for Obama.
One thing is clearly obvious here folks: THEY HAVE NO IDEA WHAT THEY ARE SUPPOSED TO DO!
I have a brilliant idea: Stay the hell out of it! Perhaps doing nothing is what needs to be done. If these clowns refuse to nationalize the banks then they better at least clean them up:
The criminals who created this mess MUST be swept up and either fired or put in jail. There will be no confidence in the banking system until this is done. PERIOD. The current group of pigs on Wall St have lost all credibility. If Obama doesn't watch himself he is going to see his approval rating plummet to George Bush levels.
Folks, we need a leader right now. We need a guy who will make tough decisions and stand by them. WE CAN'T AFFORD A PRESIDENTIAL FLIP FLOPPER AT THIS POINT!
Where is Abraham Lincoln when you need him? He knew how to make tough decisions. Without him this nation never would have survived the Civil War. Presidents make tough decisions! We are seeing nothing that resembles this coming out of Washington.
Obama is looking more and more lost with each passing day. I like him and I am pulling for him, but man he is royally screwing up. He needs to start acting presidential or this economy is toast. Its time for him to grow a pair and pull the plug on this group of pigmen on Wall St.
The market has sent a clear message to Obama and his flip flopping by plummeting over 11% in less than two weeks! We will find ourselves down another 11% if he continues these ridiculous policies that provide no clarity.
This lack of transparency is getting real old. The "hide the losses" approach is no longer acceptable to investors.
We need to face a grim reality as a nation here folks: Hundreds of banks and perhaps thousands of businesses need to go under. There is no stopping it because we simply don't have the money to contain it anymore!
How many times does this socialistic whimpy approach have to fail until we accept the obvious? The government can'tt replace the consumption of the consumer over the long haul. Eventually the government stimulus will have to be yanked and when it does LOOK OUT if we continue down this path.
The only way our economy will prosper is by creating an environment in which people can be successful. Keeping millions in homes that they cannot afford in order to stabilize home prices is not the way to go!
LETS TAKE THE PAIN AND MOVE ON!
The longer we wait the more painful its going to be.