Dow Drops Nearly 300 Points

Q: Technical analysis isn't all of the market's story, but it is highly significant. Today wasn't pretty. Enormous technical damage has been done with both the DOW and the S&P breaking below support-levels. I'll spare the details, but the closes today make another 10% decline quite possible before a bottom is formed, and we move on from there. If that sounds like the markets are in "the-sky-is-falling" range, well, they are, technically speaking.

A: I think O'Bomber will go back to Congress for another $750 billion in
bank bailout money, although perhaps first Geistner will change his Bad
Bank approach to the Paulson Nationalization Scheme. Supposedly that
has a higher multiplier value for the money that's put into the banks.

In New York, the gyrations in stocks came as President

Obama signed the
$787 billion economic stimulus package and executives at General Motors
and Chrysler prepared to submit major restructuring plans to the federal
government after receiving billions in bailout money.


General Motors stock, which was more than $25 last February, was trading
lower on Tuesday, at about $2.15 a share. Shares of the Ford Motor
Company, which has not received any bailout funds, were down 5 percent.


Analysts said investors were still nervous about the Treasury
Department’s plans to shore up the financial system and help remove
billions of dollars in troubled mortgage-related assets from the balance
sheets of major banks.


“The administration is great at floating the rumors, but we need
concrete plans to back that up,” said Ryan Larson, head equity trader at
Voyageur Asset Management. “Without any further concreted details, the
market’s really left to wonder. And in this environment, they wonder the
worst-case scenario.”


Crude oil closed down $2.58 to $34.93 a barrel, pulling down energy
companies. Exxon Mobil, Chevron and Total skidded as consumers and
industries continued to scale back their demand for oil and gasoline.


In a sign of further deterioration in the industrial sector, a gauge of
manufacturing in New York State fell precipitously in February,
reflecting a plunge in new orders, prices and employment. The Empire
State Manufacturing Survey, which is calculated by the Federal Reserve
Bank of New York, fell to a new low of minus 34.7 in February, from
minus 22.2 in January.