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Stocks Jump As Rate Cut Hopes Increase (Dow up 335, NASD up 80)
AP?YodleWho! ^ | Wednesday November 28, 2:57 pm ET | By Madlen Read, AP Business Writer

Posted on 11/28/2007 12:14:44 PM PST by rightinthemiddle

Wall Street Has 2nd Straight Rally on Rate Cut Hopes, Signs That Financials Are Finding Cash

NEW YORK (AP) -- Wall Street barreled higher Wednesday for the second day in a row, propelling the Dow Jones industrials up more than 300 points after a Federal Reserve official hinted that the central bank may lower interest rates again.

Investors' renewed hopes for a rate cut added to their relief that companies that made losing bets on subprime mortgages, such as Citigroup Inc. and Freddie Mac, are coming up with ways to raise cash.

Early Wednesday, Fed Vice Chairman Donald Kohn told the Council on Foreign Relations that recent financial turbulence has reversed some of the improvement seen in markets in previous weeks, and could squeeze credit for households and businesses. He said tight financial conditions may merit "offsetting" policy from the central bank.

(Excerpt) Read more at biz.yahoo.com ...


TOPICS: Business/Economy
KEYWORDS: djia; dow10000; economy; fed; markets; stocks; wallstreet; wgids
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I sold my TXN last Wednesday at $30 and change...I held it for 12 years. I told my broker "this is the bottom" if I'm selling my favorite stock."

Maybe I was right.

1 posted on 11/28/2007 12:14:45 PM PST by rightinthemiddle
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To: rightinthemiddle
DOW Up! Oil Down!

Democrats deeply saddened.

2 posted on 11/28/2007 12:15:17 PM PST by Phantom Lord (Fall on to your knees for the Phantom Lord)
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To: rightinthemiddle; Toddsterpatriot; Larry Lucido

But I wanna be doomed!!!


3 posted on 11/28/2007 12:15:51 PM PST by Petronski (Reject the liberal troika: romney, giuliani, mccain)
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To: rightinthemiddle

Dow up over 500 points in two days?

Cool.


4 posted on 11/28/2007 12:16:01 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: Phantom Lord

Goldbugs and Oil Barons deeply saddened.


5 posted on 11/28/2007 12:16:12 PM PST by rightinthemiddle (Without the Media, the Left and Islamofacists are Nothing.)
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To: Hydroshock

Ping!


6 posted on 11/28/2007 12:16:43 PM PST by rightinthemiddle (Without the Media, the Left and Islamofacists are Nothing.)
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To: rightinthemiddle

LOL!


7 posted on 11/28/2007 12:18:12 PM PST by Toddsterpatriot (What came first, the bad math or the goldbuggery?)
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To: NeoCaveman

May be close to 600...I don’t see this rally dying today.

But, tomorrow is a different day.


8 posted on 11/28/2007 12:18:22 PM PST by rightinthemiddle (Without the Media, the Left and Islamofacists are Nothing.)
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To: rightinthemiddle

We are about, what, 700 - 800 points from the all time high or so?


9 posted on 11/28/2007 12:19:23 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: rightinthemiddle

How is NYT doing? :0)


10 posted on 11/28/2007 12:20:52 PM PST by Cowboy Bob (Real men don't vote Democrat.)
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To: NeoCaveman

About 900.


11 posted on 11/28/2007 12:21:16 PM PST by Toddsterpatriot (What came first, the bad math or the goldbuggery?)
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To: rightinthemiddle

Bush’s fault?


12 posted on 11/28/2007 12:22:01 PM PST by sionnsar (trad-anglican.faithweb.com |Iran Azadi| 5yst3m 0wn3d - it's N0t Y0ur5 (SONY) | UN: Useless Nations)
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To: Toddsterpatriot
Nothing makes my week like watching the bears take it right in the teeth.


13 posted on 11/28/2007 12:23:10 PM PST by Petronski (Reject the liberal troika: romney, giuliani, mccain)
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To: Toddsterpatriot

Cool.


14 posted on 11/28/2007 12:23:11 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: rightinthemiddle

I almost called my broker Monday to tell him to go completely to cash. Glad I didn’t. Probably also a sign of a bottom.


15 posted on 11/28/2007 12:24:04 PM PST by jalisco555 ("The only thing we learn from history is that we never learn from history." Winston Churchill)
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To: NeoCaveman

Let me check...I think it was 14,300.

Up 365 now.


16 posted on 11/28/2007 12:27:41 PM PST by rightinthemiddle (Without the Media, the Left and Islamofacists are Nothing.)
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To: jalisco555

You’re exactly correct. When most Americans, who have an upside mental bias (ie, Americans are, by and large, optimists) finally throw in the towel, it is usually close to the bottom.

One of the things necessary to becoming a successful trader (as opposed to investor) is to be able to observe these emotions in one’s self, and then do exactly the *opposite* of what your instinct tells you to do.

I covered shorts earlier this week because I was feeling like “Awwww crap... I’m going to have to sell all these longs and take losses...” so I did the exact opposite: covered my shorts.

When did I put the shorts on? When I was feeling pretty darn pleased with myself.


17 posted on 11/28/2007 12:27:52 PM PST by NVDave
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To: Cowboy Bob

It’s a SELL.


18 posted on 11/28/2007 12:28:14 PM PST by rightinthemiddle (Without the Media, the Left and Islamofacists are Nothing.)
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To: rightinthemiddle

The Fed Rate Cuts will not stop the impending issues....

Remember folks, Japs fed had rates at 0% for years, and they still were in recession for nearly a decade.


19 posted on 11/28/2007 12:29:59 PM PST by HamiltonJay
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To: rightinthemiddle

Does this (if they cut rates) translate into lower re-fi rates for mortgages?


20 posted on 11/28/2007 12:30:32 PM PST by CygnusXI (Where's that dang Meteor already?)
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To: rightinthemiddle
I think 14,180.
21 posted on 11/28/2007 12:32:30 PM PST by Toddsterpatriot (What came first, the bad math or the goldbuggery?)
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To: HamiltonJay

22 posted on 11/28/2007 12:34:42 PM PST by jdm
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To: rightinthemiddle

The fed opened the door for a further interest rate reduction. I don’t see how that doesn’t bode well for gold and bad for the dollar long term.


23 posted on 11/28/2007 12:34:52 PM PST by Rockitz (This isn't rocket science- Follow the money and you'll find the truth.)
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To: Petronski; rightinthemiddle; Toddsterpatriot

But, but...oil prices! And the housing bubble! And housing price crash! And flat Chrismas sales! And the credit crunch in March from the, um, from all the Christmas sales..


24 posted on 11/28/2007 12:36:50 PM PST by Larry Lucido (Hunter 2008)
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To: rightinthemiddle

25 posted on 11/28/2007 12:37:10 PM PST by Republican Red (The word "courage" is not in the liberal vocabulary)
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To: CygnusXI; RockinRight
Does this (if they cut rates) translate into lower re-fi rates for mortgages?

Oddly, no, not directly. Most ARMS are calculated based on an index called LIBOR (and published in the WSJ). RnR will know.

26 posted on 11/28/2007 12:37:37 PM PST by Petronski (Reject the liberal troika: romney, giuliani, mccain)
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To: jdm

Hahaha... just stating the truth.

Rate Cuts only do so much... I know it excites the emotional folks on wall street, but much of the issues we are facing are not related to rate cuts.

Not only that, but with every rate cut they do enact, you will see the dollar further slide against foreign currencies.


27 posted on 11/28/2007 12:37:47 PM PST by HamiltonJay
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To: rightinthemiddle
The dollar is doing “better” as well. If they are anticipating a rate cut, why is the dollar going up?
28 posted on 11/28/2007 12:39:58 PM PST by Perdogg (Elections have consequences.)
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To: rightinthemiddle

Bear market rallies are vicious, as are topping rallies.

Early 2000 had a rally that somewhat outdid this one.

We all know what happened next.


29 posted on 11/28/2007 12:39:58 PM PST by steve86 (Acerbic by nature, not nurture™)
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To: rightinthemiddle

No, The FR goldbugs said gold was going to $2000.


30 posted on 11/28/2007 12:41:40 PM PST by Beagle8U (FreeRepublic -- One stop shopping ....... Its the Conservative Super WalMart for news .)
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To: rightinthemiddle

A rate cut! Yipppeee!!!

Inflation here we come!!


31 posted on 11/28/2007 12:42:08 PM PST by Obadiah
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To: Perdogg
The dollar is doing “better” as well. If they are anticipating a rate cut, why is the dollar going up?

I don't think the author is correct, that this is a rally based on an expected rate cut.

I think this is a continuation of yesterday's rally that had 3 reasons
1. strong holiday sales
2. Abu Dabi stepping in with their petro dollars
3. stocks were getting too cheap.

32 posted on 11/28/2007 12:43:11 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: rightinthemiddle

I hope they raise rates and send all these fools to the poor house!


33 posted on 11/28/2007 12:43:54 PM PST by dalereed
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To: HamiltonJay
I understand your concern, but it's worth noting that a big difference with Japan is that it has a lot of what might be called "institutional stagnation" -- i.e., no population growth, limited acceptance of immigrants, etc. -- that tends to act as an enormous anchor on their economy.

The U.S. has to cope with some of these factors, but to a far lesser extent than Japan did.

34 posted on 11/28/2007 12:44:25 PM PST by Alberta's Child (I'm out on the outskirts of nowhere . . . with ghosts on my trail, chasing me there.)
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To: Alberta's Child
no population growth, limited acceptance of immigrants, etc. -- that tends to act as an enormous anchor on their economy.

How does this differ from what a large fraction of people on here want for this country?

35 posted on 11/28/2007 12:47:14 PM PST by garbanzo (Government is not the solution to our problems. Government is the problem.)
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To: Petronski

Fixed rates are based on the 10 year bond as well.

Generally, the LIBOR follows the Prime rate but there is no direct correlation.


36 posted on 11/28/2007 12:47:20 PM PST by RockinRight (Just because you're pro-life and talk about God a lot doesn't mean you're a conservative.)
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To: CygnusXI

I don’t follow it closely but three-month LIBOR rates are up today, and most days.


37 posted on 11/28/2007 12:48:42 PM PST by steve86 (Acerbic by nature, not nurture™)
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To: RockinRight
...there is no direct correlation.

That's the part I was getting at (or trying to...).

38 posted on 11/28/2007 12:49:03 PM PST by Petronski (Reject the liberal troika: romney, giuliani, mccain)
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To: Alberta's Child

I’m not implying the US is Japan, I’m just point out that rate cuts are limited in their impact, and the mess of the housing and credit crunch are not going to be alleviated by a rate cut.

There was a long run of good times, and now the piper will be paid. Fed can do things, but it can’t eliminate this.

At the end of the day, the bulk of the economy can be traced back to real property... and the value of that is contracting and going to continue to for quite some time. Rate Cuts won’t change that.


39 posted on 11/28/2007 12:50:20 PM PST by HamiltonJay
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To: Phantom Lord
I've been hearing this guy on the top of the news every hour saying how investors aren't paying attention to the housing problems we have. As if trying to say...

"HEY, you idiots... You can't make the markets go up, we've got BIG problems here!"

40 posted on 11/28/2007 12:50:26 PM PST by RogerWilko
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To: RogerWilko

What if the media wanted to have a recession but no one participated in it?


41 posted on 11/28/2007 12:52:26 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: NeoCaveman

Then the MSM would be crestfallen because their liberal Democrat brethren would not be assisted in the manner they had hoped for. Does that answer your question?


42 posted on 11/28/2007 12:53:54 PM PST by Obadiah
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To: Cowboy Bob

43 posted on 11/28/2007 12:54:21 PM PST by oh8eleven (RVN '67-'68)
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To: Obadiah

Well it was a rhetorical question but you did answer it correctly.


44 posted on 11/28/2007 12:54:39 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: Petronski

Rates are going down faster than your beloved Tribe did in games 5-7 of the ALCS!!!!

Hah


45 posted on 11/28/2007 12:54:39 PM PST by misterrob (Eleven down, Eight more til the Pats win the SB again.)
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To: NeoCaveman
They need things to be BAAADDD next year! Don't forget... We got an election and the Dumbacrats need to win!

We need a bad stock market and a bad economy and BY GEORGE... If we don't have one, we'll MAKE ONE UP!

46 posted on 11/28/2007 12:54:43 PM PST by RogerWilko
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To: oh8eleven

Pinch’s fault!


47 posted on 11/28/2007 12:54:59 PM PST by NeoCaveman ("On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo." - Ann Coulter)
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To: Beagle8U

Let’s revisit the question in a year or two.


48 posted on 11/28/2007 12:55:05 PM PST by coloradan (Failing to protect the liberties of your enemies establishes precedents that will reach to yourself.)
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To: misterrob
Wow, trash-talk from a Boston sports fan.

That's . . . so . . . atypical.

49 posted on 11/28/2007 12:55:37 PM PST by Petronski (Reject the liberal troika: romney, giuliani, mccain)
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To: RockinRight; Petronski
Generally, the LIBOR follows the Prime rate but there is no direct correlation.

Especially since the LIBOR is the London InterBank Offered Rate.

50 posted on 11/28/2007 12:56:13 PM PST by Phantom Lord (Fall on to your knees for the Phantom Lord)
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