Daily Investment Interpretations

September 9, 2008

2008-9-9:   The price of oil fell approximately $3 today to $103.26 in spite of Hurricane IKE heading for the Gulf Coast. This had no positive influence on the stock market, which tumbled head-over-heels. The Nasdaq dropped about 56 points to about 2,210. The Dow shed 280 points to 11,230.73. The S&P lost 43.28 points to 1,224.51. The VIX rose nearly three points to 25.47. So what happened? Lehman Brothers, which was on the chopping block at the time of the Bear Stearns bailout, announced that a deal to raise new capital from Korean investors had fallen through. (Presumably, when they performed due diligence, they discovered just how parlous a state Lehman Brothers was in.) :The Lehman Brothers stock price swooned 40%, while the next bank in line for the execution block, Washington Mutual, declined in price by 20%.
    Here are articles by Paul Farrell, Michael Ashbaugh, and Mark Hulbert.