October 14th, 2008
06:30 AM ET

Party like it’s 1929!

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/10/13/art.nyse.up900.jpg]Susan Lisovicz | Bio
CNN Financial Correspondent

Maybe we can finally go back to drinking gin and doing the Charleston. After all, too many market reports that included words like “crash” and “Great Depression,” the bulls stampeded back onto Wall Street and partied like it was 1929.

Did things really change that much since the worst week ever for the Dow Industrials? Well, yes - and no. European leaders said they would guarantee bank debt in another unprecedented effort to free up frozen credit markets. Great Britain said it would spend tens of billions to bail out three of its major banks. The Federal Reserve said it would make available unlimited amounts of money to support three European central banks. “They brought out the heavy artillery,“ said one analyst. And we haven’t even heard from the U.S. Treasury Department and the billions more it’s going to throw down.

But that’s only part of the story. “It was the buying opportunity of a lifetime,” said one trader. So, after dipping below 8,000 on its eighth consecutive sell off Friday… the Dow rocketed well over 9300 Monday. The only fear in the marketplace on this day was the fear of being left out. Morgan Stanley shares soared 87%. But it was still only $18 a share… a third of its 52-week high. G.M. jumped 33%. It’s trading at $6.50, where it was oh, about half a century ago.

So, bottoms up. But given the economy’s shape, there’s a lot of debate as to whether this signifies the market’s bottom.

Filed under: 360° Radar • Bailout Turmoil • Economy • Susan Lisovicz
soundoff (3 Responses)
  1. Gene Penszynski from Vermont

    P.S. Yes the champaign corks were popping in 1929 just before the entire stock market collapsed and we entered a period of economic decline so depressing that it took nearly 15 years of massive government intervention and a world war to get us out of it.

    The side effects were simply devestating for humaity with the rise of Dictatorships and the NAZI's. I wouldn't look back on 1929 as the 'good ole days'.

    October 14, 2008 at 9:08 am |
  2. Gene Penszynski from Vermont

    Sorry Susan . Hate to rain on your parade but this simply is not over yet. The issue underlying this whole mess if the destruction of the American Middle Class and the outsourcing of our Manufacturing Infrastructure to the slave labor colonies of India and COMMUNIST China which has exfdelerated beyond control during the G W Bush years whith out the government even blinking at the millions who are now suffering in this nation due to lost employment and under employment. Any economic expansion during this time has been funded primarily though the housing market with home equity loans and such. Our de4bt is beyond staggering it's obscene.
    All this yapping about wall streets largest gain may very well soon fade in comparison to yet enother record retreat when reality finally sets in.

    The only good thing that has come out of this so far is that G W Bush's neo-con 'The Markets will correct themselves' mentality has been proven beyond a doubt to be a total failure and RESPOSIBLE CAPITALISM (a merging of European socialism and expanded government regulation) seems to be replacing it. It is only When unfettered 'laissez faire' Hoverian Economics is finally buried that we will see lasting stability and sustained, humane and safe economic growth. Wall street Hooplah be damned.

    October 14, 2008 at 9:00 am |
  3. Richard Kennedy

    As Nancy Pelosi suggest a second financial suport plan of +/- $1 trillion USD is not out of the question, we need to stand behind our American investors, banks and finacial institutions if we (Americans) are to continue being the number one economic global leader, timing is everything during this financial crises.

    Richard Kennedy
    Kalispell, MT

    October 14, 2008 at 6:34 am |