On Oct 3, 2008, at 4:03 PM, Bob Morris wrote:
> Since Thursday, when the Senate voted yes on the bailout and passage
> by the
> House seemed probable, the DOW has dropped 500 points. Hardly a vote
> of
> confidence in the bailout. (Or maybe it would have dropped anyway.)
Two points. They rallied earlier in the week on the assumption that some bailout would pass. Actual passage is an anticlimax. As the Wall Street nostrum goes, buy the rumor, sell the news. And second, in past crises/bailouts (our S&Ls, and the crises in Sweden, Japan, and Korea), stock markets continued to fall for a while before rallying - strongly in most cases.
Doug