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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ajtj99 who wrote (10653)	11/20/2008 8:16:26 PM
From: John Pitera	Respond to of 33421

Right you are AJ, thursday's not a good market bottoming day... We may be looking at some pretty interesting prices by then, It's certainly generating serious consternation that the 2002 lows have been taken out on the SPX. Drudge's headline tonight is FEAR STALKS WORLD'S ECONOMIES.... Fear stalks the world’s economies By Alan Beattie in London and Michael Mackenzie in New York Published: November 20 2008 20:48 \| Last updated: November 20 2008 21:16 Fears of a severe global recession gripped financial markets on Thursday, sending interest rates to record lows and driving down US stock prices to their worst close in more than a decade. Economic news across the world was almost uniformly bad. US jobless claims soared while slumping Japanese exports threatened to push the economy further into recession and the Swiss central bank unexpectedly slashed interest rates by a full percentage point. In China, officials warned that the employment outlook was becoming “grim”, as the global financial crisis led to more factory closures in the export sector. Two-year US interest rates slid below 1 per cent to their lowest levels yet amid a gathering conviction that the Federal Reserve would cut interest rates again next month. UK bond yields dropped to their lowest levels since the second world war. The S&P 500 equity index fell 6.7 per cent to 752.44 - its lowest close since 1997 - as financial stocks plunged. Earlier in Europe, the FTSE 100 fell 3.3 per cent and Germany’s Dax lost 3.1 per cent. “This is all about disinflation and deflation,” said Alan Ruskin, a strategist at RBS Greenwich Capital. “Rates can go low and stay low for a protracted period.” On top of Wednesday’s announcement of a record one-month fall in the US consumer price index, the rising risk of a damaging deflationary crunch also pushed oil prices below $50 a barrel for the first time since 2005, amid signs of fracture in the Opec oil cartel. “For some time it has not been a question of whether we will see deflation but if it will be the benign kind, where lower commodity prices boost consumption, or a malign spiral of falling prices pushing up the value of debt,” said Julian Jessop, chief international economist at the consultancy Capital Economics. “Today’s figures all point to the malign variety.” Official figures showed 542,000 US workers filing new claims for jobless benefits last week, the highest number since the early 1990s recession. The figures were well above economists’ forecasts of just over 500,000, and are likely to mean another sharp drop in employment in November. The White House said US president George W. Bush would sign a bill pending in Congress to extend unemployment benefits to workers by at least seven weeks, and longer for states with higher unemployment rates. On Thursday some short-term US Treasury bills were quoted near or below zero per cent. Two-year bond yields fell as low as 0.96 per cent, the lowest since the two-year note was created in 1976, before edging up later in the day. Yields on the 30-year bond fell to a record low of 3.58 per cent. *Market analysts said panic had set in among traders. “Markets are utterly unhinged,”* said Bill O’Donnell, strategist at UBS. Additional reporting by Javier Blas in London and Geoff Dyer in Beijing Copyright The Financial Times Limited 2008 ---------------- (Editorial note by JP:quoted below zero percent "here I'll give you more than a buck, just so long as you give me the buck back.' Now that is Truly Will Rodgers old maxim.... I'm not as much concerned about the return on my money as I am in the RETURN OF MY MONEY" JP)