Markets Soar, SEC Clamps Down, Feds Debt Plan

The stock market soared today on news that the Federal Reserve is considering creating an entity to contain bad real estate debts; much like the RTC after the Saving&Loan debacle of the go go 1980’s. Short sell regulations and clamping down on free wheeling hedge funds have also been suggested to help control the chaos. Moral hazards and passing the buck to taxpayers are two of the arguments being floated against the intervention. The DJIA closed up +378.52 to 10988.18, the Nasdaq climbed an astounding +100.25 to 2199.10 and the broad based S&P 500 exploded up +46.09 to 1202.48.

Morgan Stanley
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climbed .83% or $0.18 to $21.93/share on merger with Wachovia Bank potential.

General Motors
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drove 14.20% or $1.41 higher to $11.34/share on Congress considering loaning billions to lift the lagging auto industry.

Citigroup
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soared 19.24% or $2.70 to $16.73/share on the potential government bad debt entity creation.

Nextwave Wireless
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obtained $100 million credit line leading to the stock surging 29.87% or .23 cents to $1.00/share.

Oil climbed $0.92 to $98.08/barrel, Gold slipped $3.00 to $847.50 and the short term VIX fell 6.81% TO 33.84 on market optimism.

Market Snapshot

Dow

+378.52 10988.18

NASDAQ

+100.25 2199.10

S&P 500

+46.09 1202.48

Economic
News

Consumer Credit (Q2): Consensus $8.5B, Prior $11.0B

Pending Home Sales (Q2): Consensus -1.4%, Prior 5.3%

Wholesale Inventories (Jul): Consensus 0.7%, Prior 1.1%

Crude Inventories (09/06): Consensus NA, Prior -1898K

Export Prices ex-oil (Aug): Consensus NA, Prior 0.8%

Import Prices ex-oil (Aug): Consensus NA, Prior 0.9%

Initial Claims (09/06): Consensus 440K, Prior 444K

Trade Balance (Jul): Consensus -$58.0B, Prior -$56.8B

Treasury Budget (Aug): Consensus -$105.0B, Prior -$117.0B

Core PPI (Aug): Consensus 0.2%, Prior 0.7%

PPI (Aug): Consensus -0.5%, Prior -1.2%

Retail Sales (Aug): Consensus 0.3%, Prior -0.1%

Retail Sales ex-auto (Aug): Consensus -0.2%, Prior 0.4%

Business Inventories (Jul): Consensus 0.5%, Prior 0.7%

Mich Sentiment-Prel (Sep): Consensus 64.0, Prior 63.0

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