The indices could revisit their old lows, or double bottom, if asset and debt liquidations continue and private institutions/overseas buyers fail to put an underlying bid on our country's distressed assets. I'm not sure how the market will respond if the GOV/U.S tax payers end up bailing everyone out (GM, Banks and GSE's). If the U.S tax payers buy all these distressed assets and hold on to them for years, the assets would eventually increase in value and the tax payers could receive a nice dividend check in the mail when the assets are sold back to the private enterprise at a profit! RIGHT?? So US tax payers are now a pooled distressed US investment fund putting a bid under the distressed assets, possibly saving the market and their home values. It's an automatic bottom with a short term cost. If the U.S Government would stop printing money and spending like crazy it could actually benefit us down the road. If that could only work.
Officials announce takeover of mortgage giants
Auto industry to press Congress for $50B in loans
U.S. unemployment rate hits 6.1%, highest level in five years
Oil hits 5-month low as demand shrinks
New-Home Sales in U.S. Increase From 17-Year Low
Durable goods post strong gains in June, July
Leading economic indicators fell sharply in July
Here's a look at charts, sourced from stockcharts.com and schaeffersresearch.com, of the Dow Jones Industrials, S&P 500, and VIX (Volatility Index), with technical analysis for September 8, 2008. Also presented is the exchange traded funds SPY and DIA's short interest vs price activity, however it's data ending 8/15/08 which is about a month old. Short interest ending 9/1 could make a bounce. It looks like there's been short covering in recent months as well as a lower put/call open interest ratio, however according to Schaeffersresearch its still at 1.63 which is a heavily bearish bias.