777
777 and NO I am not talking about a new Boeing luxury dream liner, I am talking about the number of points the Dow shed today while I was busy closing loans. -6.98% to be exact, the largest single point loss in the Dow Jones history! Let me clarify that it is not the largest loss by percentage, that still stands somewhere near 20%. By the time I fired up the old lap top this morning at 8 am or so the Dow was already getting beat like a pi~nada at a fiesta and Bonds were being bought up as faster then the traders could hit buy on their trading domes.
As the day progressed there came news that the proposed Bail Out hadbeen declined in its current form. This sent the Markets into a giant hissy fit, temper tantrum that would have had my 2 year old running for cover. He is the king of those types of fits and this one put him to shame.
The Dow was in a full scale avalanche and taking everything in its path with it. I have been watching the markets closely for years now and have not seen a day like today, to be honest I would be fine not seeing another one like it, wouldn't hurt my feelings a bit.
Wachovia the nations 3rd largest bank by assets called it quits when the FDIC stepped in and helped broker "a deal" with former banking giant CITI. There was a time when CITI was on top El Numero Uno, and with todays purchase or virtual taking of Wachovia, CITI could be poised for another run at the big Kahuna #1 spot. They will have a lot of work to do to catch JP Morgan and the solid acquisitions they have been making as of late (bear stearns, Washington Mutual). It will be interesting to watch these 2 players and see what transpires over the next 5 years with them. It was no surprise that Wachovia threw in the towel, it had been rumored for the last few months that they were on the brink of being down graded which can have nasty consequences in the banking world and severely affects one's borrowing power.
It continues to amaze me that these big banks like the big oak tree's of their industry, have weathered all sorts of financial storms and have grown despite them, are now being chopped down and sold off as firewood probably never to be thought of again as the years go on.
There are many that are trying to use this bail out to further their political agenda's and for that shame on them. This is serious business the likes not a single person in the White House, the TTreasury, the Federal Reserve Board, the Congress or the Senate have ever seen. My prayer tonight is that there is a thread of inspiration left on Capital Hill. That between the hundreds and even thousands of people involved in this legislation will know that we need to put aside any and all agenda's for a few weeks while this initial package, this literal crutch to the economy is put in place. It's time to put our way of life, our dreams and our liberties first and go to work to figure out what is best for Our Country and not just Our Party. I say this to both sides of the isle.
In the meantime we as Americans need to be wise and use good judgment each and every day. Don't cancel your trip to Disney land and certainly don't stuff the mattress with what would become worthless money. Be Smart.
Now will be a great time to lock in a LOW fixed rate mortgage and lower your interest rate by over a point for a lot of you. When the markets suffer one of the silver linings for all of us is that long term fixed rates are low low low.
I heard someone say that if they increased the tax credit for first time home buyers to $25,000 from $7500 that it would spur on the housing sector like you wouldn't believe, and we all know what a stagnant, lifeless housing market which we are in right now can do to the economy. On the other hand if we could get the fence sitters off the fence with a larger tax credit that may pay much larger dividends in the future and stop this economic spiral in its tracks. Something to chew on....
Here are links to the proposed bailout legislation, abbreviated summaries, and Statements by Key Government Leaders.
Emergency Economic Stabilization Act
Section by Section Summary of the Emergency Economic Stabilization Act
Treasury Secretary Paulson Statement on Emergency Economic Stabilization Act
FederalReserve Chairman Bernanke Statement on Emergency Economic Stabilization Act
We will see the Dow below 10,000 if not tomorrow it will be soon. My prediction my be bold but it would not surprise me to see it hit 8,000 this year (next 12 months).
Keeping you informed,
Stetson Lowe - The Mortgage Insider - www.UtahLoanTips.com
P.S. BYU being voted into the top 10 in the AP poll helped a little to off set the sting of a day like today. Go cougs keep giving us something to cheer about!
