As The Market Collapses, Here Is What Is Going On.

So yesterday we saw a 500+ point drop in the market and todays chart looks like a see-saw. Exciting, no? No, not really. I am leaving everything as-is for now, and just not looking at my numbers at all. Perusing the various financial sites this morning, I figured a quick roundup of what they are saying might be in order:

Overnight Interest Rate Doubles as Banks Hoard Cash on Failure Speculation – The cost of borrowing in dollars overnight more than doubled to the highest since 2001 as the collapse of Lehman Brothers Holdings Inc. and credit downgrades of American International Group Inc. led banks to hoard cash.

AIG shares plummet as cash crisis mounts – American International Group Inc (NYSE:AIG – News) shares plummeted after the insurer’s credit ratings were cut, heightening concerns it might file for bankruptcy and further upset the global financial system.

Lehman Employees on EBay Offer Mugs, Parting Shots – Lehman Brothers Holdings Inc.’s bankruptcy, the largest in history, sent the firm’s employees to EBay Inc.’s auction sites to offer knick-knacks and memorabilia. And parting shots.

Barclays confirms interest in Lehman Bros. assets – Barclays PLC confirmed Tuesday that it is interested in acquiring some assets of Lehman Brothers, the investment bank that collapsed after Barclays dropped out of merger talks.

UBS Shares Sold on Debt, Capital Worries – UBS AG (UBS) shares slumped more than some of its rivals in early trading Tuesday, as investors factored in reports that it could book larger-than-expected third-quarter write-downs on the risky positions the bank still holds

NY Fed pumps $50B into Wall Street – Urgently trying to keep cash flowing amid a Wall Street meltdown, the Federal Reserve on Tuesday pumped $50 billion into the nation’s financial system to help ease credit stresses.

So what are you guys doing? Are you moving money? Staying put? Panicking? Hiding under the table and crying? Both my Mother-in-law and my 96 year old grandmother asked my advice yesterday; you know things are bad when they know what is going on with the market!

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Comments (8)

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  2. T'pol says:

    I have addressed this issue in my blog just minutes ago. Since it is a Turkish blog, you cannot go over and read but here is the metaphor I used: Going through a financial crisis is like going through an icy patch on the slopes while you are skiing. You just have to be careful balancing and not try controlling the skiis. Once you are through the ice patch, you can slow down or stop if you want to. The impact of what is going on in the US is most certainly felt in countries like mine. Our stock market has taken a nose dive here in Turkey as well. I mostly own bonds and YTL accounts with favorable interest rates but I also do own some stocks. I had some extra cash this month and I have used a part of it to buy some shares which I believe are discounted these days. I need that money in 15-20 years so, I buy instead of sell and realize the loss. When you do not sell, it is not a loss. Just look at the number of shares you own. If I didn’t have the money to buy more, I would just stay put. Meanwhile I am trying to save more than ever and cutting down on unnecessary expenses such as eating out or Starbucks coffee etc.

  3. I was a stock broker during the first “Black Monday” in 1987 and again in 1989. This one looks different to me, however back then, peole were buying from like crazy the following week, as they saw bargins I was not even aware of. They we right, I was wrong. I certainly hope the fed, with its fiat money system, does not try to salvage this one.

  4. I’m nervous, but I also have a lot of trust in my bank. I hope it’s not misplaced. As far as our stocks go, there’s not a whole lot to be done as they’re largely in technology, which is just taking the general beating that the rest of the market is taking.

    I feel a little cushioned from the reality of this economic meltdown by, of all things, my large garden and our four laying hens. I don’t have to drive anywhere to feed myself, and I’m pretty much oblivious to rising food prices. Our 2/3 acre lot is plenty big enough to produce a great deal of food. Yes, I buy dairy and some staples. But I bake my own bread and we’ve got a chest freezer full of garden produce, meat bought by the side or when I spotted a sale, and plenty of made-ahead from scratch meals. We’re looking forward to the apple harvest from our one old tree in a few more weeks. I’ve been grocery shopping once this month, and will probably go once more for a little milk and other dairy. It’s some comfort in these scary times to know we’ll still be eating well for the next few months, at least, no matter what happens.

  5. david says:

    Kate, you are well ahead of me. You are where I want to be, but we are only slowly getting there!

  6. thinkingthing says:

    Dropped stop-loss and bought deeper into the down market. The way some of these personal finance blogs have been going, starting to think I’d be better off investing in canned tuna and shotgun shells. Oh well, guess I’m on ramen until Aztec rapture.

  7. david says:

    You only have to wait 4 more years till 2012 for that!

  8. Curt says:

    I don’t understand why most of the financial media is still interviewing with the same ‘experts’ that have been wrong about so many things over the last year. The all but forgotten dooms-dayers were right all along. The financial market is collapsing. Get out while your can.