Markets Hammered As Major Stocks Falter

24/7 Wall Street ^ | May 14, 2012 | Douglas A. McIntyre

[AmonAmarth]

The DJIA is off over 100 points, 136 points, to 12,686. The NASDAQ and S&P 500 are off by similar percentages.

The carnage is particularly severe in a few sectors.

News that JP Morgan (NYSE: JPM) fired its chief investment officer reminded investors of how badly risk is managed at large banks. JPM has taken a $2 billion write-off its London traders took. JPM is down 2.81% to $35.90.Back of America (NYSE: BAC) is down 2% on similar sentiment about risk to $7.39, and Citigroup (NYSE: C) is down 2%. Morgan Stanley (NYSE: MS) is down 3.4%. Its debt will probably be downgraded this summer, according to a number of sources.

[11th Commandment]

Wall Street euphoria is over? Most investors have had their heads in the sand about the true economic picture but they can no longer escape reality.

First, Obama's "seasonally adjusted" job numbers came home to roast in March.

Next JP Morgan's losses brought a real light on the exposure US banks have to European Sovereign debt through derivatives.

News that Greece will exit the euro soon which will start the losses for US Banks.

GDP numbers revised down.

Europe continues to vote against austerity.

[RegulatorCountry]

If slightly more than a 1% decline qualifies as “carnage” I can’t wait to see the lurid hotbutton headline for a 5% decline. Aaiiieee, it’s Teotwawki for evrybody but websites getting all those clickthroughs due to new, even scarier headlines., now with more carnage, click today!

[Vaduz]

Until Obama&co are out of office the only safe place for money is in a mason jar.

[Crucial]

The government makes rules that make it harder to succeed and therefore easier to fail in this economy. Then when a bank fails, they use it as an excuse to put in more regulations that give the banks less flexibility and thus more vulnerability to failure.

The whole thing is ridiculous. Regulation has become the biggest economic threat this country is facing. It is slowing the economy down and keeping us from earning enough to pay down our debt.

[GOPJ]

California’s Greece... Greece will be the first PIIGS to go down...pulling in the rest of them. That’s what California will be to us...

[John W]

We don’t see the “big” declines with Obama in office, for some reason.

[longtermmemmory]

Obama might be re-elected fear.

[WILLIALAL]

A continuation of the reaction to the over leverage of too much debt. Long term de-leveraging will be hard to reverse.