By JOE BEL BRUNO, AP Business Writer,AP
Posted: 2007-08-14 18:12:27
The downturn in stocks was first triggered by a report from Wal-Mart Stores Inc. that profit will fall below expectations this year as consumers rein in spending. Home Depot Inc., the world’s biggest home improvement chain, added to the slide when it said weakness in the housing market caused quarterly profit to slide.
Confirmation that Sentinel Management Group Inc., which oversees $1.6 billion in assets, is seeking to halt investor redemptions exacerbated the selling. Other funds are said to have similar problems as they face withdrawal demands at a time it has become difficult to value low-quality debt.
Hedge funds and other big institutional investors have taken a beating in recent weeks due to the market turbulence. On Monday, Goldman Sachs Group Inc. said three funds it manages have had significant losses — and infused $3 billion in capital into one of them.
Wall Street has been pummeled as a deepening credit crunch spooked the market, and led to unease about potential losses at financial firms and funds. The Federal Reserve, which has injected some $64 billion of liquidity into the U.S. banking system since Thursday, said Tuesday it stood ready to act again should market conditions warrant.
While the market seemed to be looking past most economic news in recent weeks, on Tuesday the earnings reports and their implications for consumer spending compounded an already high state of anxiety on Wall Street.
“The market is very, very sensitive at this point, and any news about a potential financial problems is going to affect the way that the market trades,” said Scott Fullman, director of investment strategy for I.A. Englander & Co. “We’ve been seeing extreme sensitivity in the financials, but also in the consumer stocks and industrials during the session.”
Basically subprime and credit is the new oil/Iraq and media and wallstreet will ride it until there is nothing left to squeeze. Average people will once again suffer through higher rates, higher rents, lower home prices, and loss of jobs. Half the volume in wallstreet is hedge funds and no one I know has ever even invested in MBS.
Basically subprime and credit is the new oil/Iraq and media and wallstreet will ride it until there is nothing left to squeeze. Average people will once again suffer through higher rates, higher rents, lower home prices, and loss of jobs. Half the volume in wallstreet is hedge funds and no one I know has ever even invested in MBS.
Basically subprime and credit is the new oil/Iraq and media and wallstreet will ride it until there is nothing left to squeeze. Average people will once again suffer through higher rates, higher rents, lower home prices, and loss of jobs. Half the volume in wallstreet is hedge funds and no one I know has ever even invested in MBS.
Right, but when the hedge funds sell to cover their bond losses, they drive stock prices down, which whacks all small-timers portfolios. A pity the Old Gray Lady is too dense to understand that point, but she’s been in decline for some time now.
Right, but when the hedge funds sell to cover their bond losses, they drive stock prices down, which whacks all small-timers portfolios. A pity the Old Gray Lady is too dense to understand that point, but she’s been in decline for some time now.
Right, but when the hedge funds sell to cover their bond losses, they drive stock prices down, which whacks all small-timers portfolios. A pity the Old Gray Lady is too dense to understand that point, but she’s been in decline for some time now.
How do you get higher rents out of that situation??? It would be just the opposite. Rents are tied to income since you can’t pay your rent with an I/O loan.
How do you get higher rents out of that situation??? It would be just the opposite. Rents are tied to income since you can’t pay your rent with an I/O loan.
How do you get higher rents out of that situation??? It would be just the opposite. Rents are tied to income since you can’t pay your rent with an I/O loan.
Unless the old lady is trying to live on the income from the investments and has a mortgage to pay etc… Gonna be tough if her portfolio is down 20% instead of up 10% a year.
Unless the old lady is trying to live on the income from the investments and has a mortgage to pay etc… Gonna be tough if her portfolio is down 20% instead of up 10% a year.
