Dow Drops More Than 200 Points

http://biz.yahoo.com/ap/060517/wall_street.html?.v=20 ^

[ndt]

"its Bush's fault."

I'm not sure if you are commenting on something I said or you just needed to get that off your chest.

[oceanview]

the book reviewer here:

http://www.amazon.com/gp/product/0691003505/qid=1147889916/sr=1-16/ref=sr_1_16/104-5218326-6431169?s=books&v=glance&n=283155

gives a review that is so in depth, it summarizes the basic thesis of the book without having to actually read it.

FDR made some big mistakes too.

[Flying Circus]

Not with the market crash, but it definitely helped put the "Great" into the Great Depression.

[oceanview]

foreign trade was tiny at that point in american history. what FDR did to prop up wages in the labor market (that no one could pay after the crash), did far more damage.

[LS]

Brilliant. You can now read a book related a subject without reading a book ON the subject. Hope that gets you through life.

HW was incredibly involved in the crash. Yes, of course the Fed played a role---and the TWO MEET in analysis in new articles by Crucini and Irwin. But increasingly, NO economist is discounting the effect of HS anymore.

Obviously, you will believe whatever you want with or without evidence because . . . you read the book review!!

[Doohickey]

Inflation caused by the runup in fuel prices. This is easily mitigated by Congressional action to aggressively pursue new sources of petroleum. I'm sure Congress will get right on that...

[VRWCmember]

When analyzing trends, it is usually better to consider more than a few hours of data.

[VRWCmember]

[Attention Surplus Disorder]

THIS I have not seen before.

http://www.newyorkfed.org/markets/omo/dmm/temp.cfm

The Fed has offered for auction appx $20 bil in Treasuries and agencies and there are apparently NO takers. None. Not even at rates below the current prime rate. And only 4.5 Bil of 21.2 bil offered in mortgage backs. Apparently, folks are catching on that the dollar is set for a serious devaluation. They don't want the debt, they don't want the coupon. Ahhh, but our exports will soar blah blah blah.

[ndt]

"When analyzing trends, it is usually better to consider more than a few hours of data."

If you buy to own you generally don't need to get flustered. It all works out if you can wait long enough.

[ContemptofCourt]

Why not just post the 6 yr trend, which has been sideways. Or the YTD NASDAQ trend or the YTD S&P 500 trend, which have been down. Or the S&P 500 in relation to bond prices.

[BurbankKarl]

I did read an interesting article on Iceland selloff a couple weeks ago. Seems a lot of investors borrowed in Japan at 1% and invested in Iceland's booming bubble getting double digit returns. When the US announced its base closures there, that all seemed to unwind.

[saganite]

Yep. They'll get riiiiiight on that. Soon as they resolve all the other important issues. Like getting re elected.

[OpusatFR]

Devaluation. That's something I've been watching...

I'm wondering if TPTB are thinking of a British pound sterling type deval like the 60's.

What to do...what to do...sit on cash or divert?

[ndt]

"Sorry you were the person I picked to reply too."

No problem, I just thought you might have misunderstood what I wrote.

"Is there a way to just post a message without replying to someone?"

I think you can just remove the names from the to list, but double check me on that.

[Old_Mil]

Smoot-Hawley: Myth and Reality

"While Smoot-Hawley did raise the average tariff rate to 53% in 1930 and to 59% in 1932, the Tariff of Abominations of 1828 produced a rate of 62% in 1830. But Smoot-Hawley applied to only one-third of all U.S. imports. Compare that to the Tariff of Abominations which applied to 92% of all imports, the Morill tariff (96%), the McKinley tariff (48%), and the Dingley Tariff (55%). The list of duty-free imports under Smoot-Hawley was the longest in history.

Considering Smoot-Hawley duties as a percentage of all imports, it ranks, in impact on trade, below every single post-Civil War tariff except the Underwood Tariff of 1913.

What of the second charge -- that the anticipation of Smoot-Hawley caused the stock market crash eight months before the act became law? In the spring of 1930 -- after Smoot-Hawley had broken through its opposition on the Hill and was headed to certain passage -- the stock market was headed due north. Eckes shows the market often rising as Smoot-Hawley's prospects improve, and falling when Smoot-Hawley appears on the ropes...

Moreover, how much adverse effect could Smoot-Hawley have had on the U.S. economy as a whole, when total imports in 1930 added up to only 4% of the GNP, and Smoot-Hawley applied to only a third of that, or to 1.3% of the GNP?

Is it conceivable that an increase in tariffs on 1.3% of the GNP triggered the collapse of five-thousand banks, wiped out five-sixths of the stock market, caused a drop of 46% in the GNP, and sent unemployment soaring to 25%?"

Obviously not. The reason for the Great Depression had everything to do with money supply and margins, not Smoot-Hawley. I hope that is instructive for those of you free-traders who learned economics from Ferris Bueller's Day Off.

[VRWCmember]

How about a 36 year trend, with a comparison to the S&P500 index for good measure:

This 200 pt drop is decried as a "plunge" and a "collapse" by alarmist economic illiterates in the press, but when the market increased by 150 or 200 pts in each of several days earlier this month did these alarmists become cheerleaders of the "soaring" markets? I don't think so. It is silly to get very excited or alarmed about the change from day to day in the market unless you are playing it like a slot machine in Vegas.

[BunnySlippers]

Consider the percentage of the drop. PLEASE!!!

[oceanview]

I simply suggested you look at the review, since its alot faster then obtaining and reading the entire book.

hey, what can I say - take it up with Uncle Milty - he says it was monetary policy, and I have seen him in TV interviews also talking about FDRs policies, being key factors in what we know of as the depression.