Market Update - 2 pm

Posted: May 16, 2008 at 2:07 pm by Chuck

Selling continues on high volume.

All indices, except for oil, are selling on above average volume so far.

Some news items mid day:

QATAR OIL MINISTER: NO NEED FOR OPEC TO MEET BEFORE SEPTEMBER, THERE IS NO NEED FOR MORE OIL SUPPLY.

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OFHEO: FNM AND FRE A “VULNERABILITY” IN MARKETS, VULNERABLE BECAUSE THEY ARE HIGHLY LEVERAGED TO RISK

- Says FNM and FRE have $5.3T in oustanding credit, three GSEs have $6.5T in oustanding credit, cap infusions could total over $25B.

- Reiterates need for strong regulator.

- FRE and FNM’s risk models are inadequate.

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FDIC’S BAIR: GOVERNMENT NEEDS MORE AGGRESSIVE HOUSING FIXES, WARNS OF GREATER HOUSING, CREDIT WOES

- Expects to see second wave of ‘credit stress’, expects more delinquencies in construction, commercial, and consumer debt

- US Housing crisis needs ‘proactive’ intervention to prevent foreclosures

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2 Responses to “Market Update - 2 pm”

ecklebob on May 16th, 2008 2:40 pm

Remember in the cartoons where if someone is pointing a gun at you, all you have to do stick your finger in the barrel of the gun and it blows up in the face of the character holding it? That is what the market brings to my mind right now. We bears are holding the gun and ….
Dave on May 16th, 2008 4:02 pm

Chuck - You own the SDS and DXD. What are your stop loss points for this trade (for anyone on the site that took the trade with you)?
Also, can you show a chart that would indicate what you liked on the technicals for SDS and DXD at your buy point?

Thanks