This is The Wall Street Digest Hotline Update for Tuesday, January 20, 2009, at 6:00 p.m. EST.
Financial stocks led the market lower today. At the close, the Dow plunged 332 points, closing at 7,949, while the Nasdaq dropped 88 points, closing at 1,441. The S&P 500 fell almost 45 points, closing at 805. Oil closed $2.23 higher at $38.74 per barrel, and gold closed $15.30 at $855.20 per ounce.
Fears that the global banking crisis is worsening sent financial stocks plunging today, with many companies' shares down by double-digit percentages and Citigroup Inc. diving to a 17-year low.
U.S and British banks are still suffering losses from loans and are warning that those losses will not subside anytime soon. Regional banks as well as the big money center banks are struggling.
Evidence that the banking crisis is worsening overseas also rattled investors. Bank stocks also dropped in the aftermath of multibillion losses announced Friday by Citigroup Inc. and Bank of America Corp.
An $825 billion stimulus bill will not stop the next Great Depression to unfold between 2010 and 2022, a period of 12 years. Pay off all debts. Sell all of your real estate if possible.
All of the bubbles including commodities, the stock market, and real estate will burst and crash. Nothing can stop the 2010-2012 bear market and recession because all of the engines of economic growth will turn negative by mid-2010.
The next Hotline Update will be on Friday, January 23, 2009, at 6:00 p.m. EST.