Bank of America To The Credit Crisis Rescue
Although Wall Street Opened with modest gains - with all three indexes about a third of a percent up - as of 2:15 pm Eastern, the big three are in the reed: The Dow Jones average down 0.07 percent, the tech-heavy NASDAQ down more than a third of a percent, while the S&P500 moved lower by 0.12 percent - Yahoo Finance.
On the bright side, Bank of America invested $2 billion in prefereed stock in America’s biggest mortgage lender, Countrywide Financial. The buy in Countrywide’s stake is largely a rescue effort to save the beleagured mortgage lender from troubling time in the mortgage sector, which means Bank of America is unlikey to want all of Countrywide.
With Asian and European markets doing pretty well (closing mostly in the green) on the Fed’s unseen promises, Wall Street has yet to believe how far the Fed will go…or if the discount window rate cut is all that’s out there.
Initial jobless claims were less than expected, which is good because although Americans have been hit with poor value on their homes, and a sweltering market-scenario, the higher income prospects will keep consumeer spending on the up and up. That might just be all it takes to keep the world’s biggest economy edging on.
The Gorilla Radio Blog provides a moment of comfort, despite trying times on the Street: “A FINANCIAL MARKET CRASH IS A PROCESS, NOT AN EVENT.”
Now for some tough love from Mike Burnick: “Mortgage industry bailouts and the related collateral damage in derivatives – many of which can’t even be accurately valued in this credit crunch environment ”
I bet some of you are probably thinking, ‘Al did voice his opinion a bit much after he left office, but still he did rescue financial markets in 1998.’
Tags: Business , Stock Markets , Finance
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