Posts Tagged ‘Wall Street Bailout’

Another, and Quite Interesting, Perspective on the Financial Crisis

October 1, 2008

  I’ve decided that another comment I have received to a post is important enough to run it as an article post. Redoubt, of the Sin City blog, who makes a lot of sense about a lot of things, has an interesting explanation of the stock market drop, and his last paragraph also makes a good point. So here it is.


1.      If I may…

“Hardly anyone is using the word “crash” because it brings back the specter of the 1929 crash, but when the market plunges more than 700 points, the largest drop in history, the term does come to mind.”

The numbers are a bit deceiving because while a 777 point is indeed the biggest POINT drop in history, it is far from the largest percentage of total market volume drop. In truth, the crash of 1929 was far larger in scale to the actual size of the market at the time, than yesterday’s fall. In other words, 10 cents off of 1 dollar is ten percent, but even 70 cents off of 100 dollars is but seven tenths of one percent.

Another noteworthy item would be that the markets have rebounded somewhat today… closing up almost 500 points (CBS News), even without $700 billion US taxpayer dollars.

The outcome is going to be tough either way but, we only have ourselves to blame if we bankrupt the nation trying to save those institutions that, basically, created the mess to begin with.

Personally, I’d rather see the money go to the consumer and those in peril of losing their homes, than to hand it over to those who held out the rotten carrot.