In case you missed it, Dow Jones dropped 778 points today, losing 1.1 TRILLION dollars, five major banks failed in the US and England, and depositors are beginning to make runs on their savings in the banks. So many people have fled stocks to government securities money market funds, that the interest rate on Fed 3 month notes is close to zero.
Duke University finance Prof. Campbell Harvey predicts there could be 750 to 1,000 bank failures over the next six months.
Scarce credit also threatens other types of companies that are already struggling and desperately need capital, such as the Detroit automakers and some of the airlines.
Some have opined that the FDIC may not be able to honor their guaranteed insurance of $100,000 per customer per bank, and a new government agency may need to be created to keep it liquid.
Campbell Soup is the only stock that went up today, suggesting soup lines may open soon.
The Republicans are blaming Obama and the Democrats for not passing the bill, even though 62% of the House Republicans voted against it and 60% of Democrats voted for it.
Lastly, the Chinese poisoned milk scare has spread to the chocolate industry. Cadbury is recalling its products with Chinese ingredients.Don't expect too much attention will be paid to the Boks' Trial. Bring a noose anyway.
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