Page Perry's Market Monitor - October 31, 2008
There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:
• On Monday, the Dow Jones Industrial Average drops by 203 points.
• On Tuesday, the Dow Jones Industrial Average surged 889 points.
• On Wednesday, the Dow Jones Industrial Average lost 74 points.
• On Thursday, the Dow Jones Industrial Average rose 190 points.
• On Friday, the Dow Jones Industrial Average rose another 144 points and closed the week at 9325.
• In September, the economy lost approximately 159,000 jobs.
• Whirlpool announced that it will cut 5,000 jobs by the end of 2009.
• American Express said it plans to cut 7,000 jobs which will result in cost savings of $1.8 billion.
• Tenneco plans to close five facilities and lay off 1,100 employees.
• The consumer confidence index hit an all-time low in October. This does not bode well for the upcoming holiday season.
• The median price of a single family home has fallen 20.3% from its peak in July, 2006 according to the Standard & Poor’s/ Case-Shiller housing index.
• Bloomberg reports that almost 20% of U.S. homeowners owe more on their loans their homes are worth.
• The Fed cut short-term interest rates by one-half point to 1%.
• The U.S. Treasury denied requests for aid submitted by General Motors and Chrysler. The Treasury’s action underscores its preoccupation with the financial services industry when it comes to bailouts.
• A merger between General Motors and Chrysler could result in the loss of between 100,000 and 200,000 jobs.
• General Motors’ global sales dropped 11%.
• Average airfares in the U.S. rose 8.1% in the second quarter of 2008.
• American International Group has now been provided with $144 billion of credit by the Fed under three different programs. This is 70% higher than the original $85 billion bailout announced by the government and provides further evidence that the government is not being honest with U.S. taxpayers about losses they are being asked to bear.
• Delta Airlines consummated its merger with Northwest Airlines.
• ExxonMobil announced that quarterly earnings had jumped almost 60% to approximately $15 billion.
• Motorola reported a third quarter loss of $397 million.
• The U.S. Department of Commerce reported that economic growth in the U.S. contracted by .3% providing further proof that the country is in a recession.
• Banks wrote off approximately $50 billion of credit card debt in the second quarter according to the Fed.
• The national debt has hit $10.2 trillion.
• Most charities and non-profits are suffering as a result of the economic downturn.
• If any of the big three U.S. automakers file bankruptcy, it would have a devastating impact on auto suppliers.
• The U.S. Treasury has invested $3.5 billion in Regions Financial.
Page Perry’s Market Monitor is published periodically to give investors an overview of certain recent developments impacting the economy and/or the investment markets.
