It’s the last trading day of the quarter and month. Portfolio managers want to minimize as best they can losses and damage for their clients. The Fed and ECB added $50 billion to their members this morning that greased the trading desks. The markets were short-term oversold after yesterday’s bloodbath.

We’re back approximately to where we were before yesterday’s failed vote, or down 300 points.

Many markets sharply reversed course including gold and bonds.

Another vote will take place so it seems. Here’s another good anti-bailout article. Further, with finger-pointing as to how we got to this point, this excellent Glass-Steagall Act article is an outstanding but lengthy recapitulation. You can see it was a bipartisan effort.

Volume was average today while breadth impressive but not a 90/10 day.




Elsewhere, money remained incredibly tight as the TED spread stayed high with overnight rates spiking to 6.88%! Fed Funds were at 7% to start the session but declined to below the 2% target rate by the close.
















But the SEC and FASB have now chimed-in, as I expected they would, to clarify their “mark to market” edicts that have caused problems with balance sheets of financial institutions. To wit: “When an active market for a security does not exist, the use of management estimates that incorporate current market participant expectations of future cash flows, and include appropriate risk premiums, is acceptable.” This is huge and the entire release is here.

The government is using all their power to reverse the markets death spiral.

But the Fed is running out of ink and paper in the printing press.