Geithner Bails CIT
Stocks were slightly up today, and bonds also went sideways. The dollar gained, and then lost value – ending sideways.
Gold went sideways.
Oil and gasoline continued their downward slide. This is beginning to look like we might get lower gas prices.
In the news today…..
Wholesale Inventories – rose 0.3% in October. This rise is after 13 months of straight declines. This could be good news, if wholesalers are restocking to be ready for an increase in retail sales. Wholesale sales rose 1.2% in October – and helped fuel the inventory buildup. Wholesalers sit between manufacturers and retail stores and provide a distribution function. Inventories are held about equally by manufacturers, retailers and wholesalers.
Sovereign Debt – this could be the subject of 2010 – as we can add Spain to the list reported yesterday. Also, Ireland is in very bad financial condition.
CIT will emerge from bankruptcy – and the taxpayer will lose $2.3B in TARP money lent to it in exchange for common shares. The taxpayer gets screwed again on TARP. CIT is the largest lender of smaller loans to businesses, and is an important part of financial systems of the US – it’s just that we don’t hear about it much. I just wonder what would have happened if Geithner hadn’t given it the TARP money. Naturally, it would have gone bankrupt, and gone bankrupt sooner. And, the taxpayer wouldn’t have lost money. Is that all? If so, then I condemn Geithner for his lousy decision.
Here are the last numbers for today:
Dow Jones 30 Industrial – 10,337 (up 51 points)
10 Year Treasury Bond – 3.42% (up 0.03%)
Euro – $1.4731
Gold – $1131 (down $12)
Oil – $70.80 (down $1,82)
Gasoline – $1.86 (down $0.07)