Monday, Nov. 17, 2008

The G20 financial summit that was held over the weekend did little to help the markets Monday, as the Dow fell 224 points by the end of the day. Leaders of the world’s largest economies had met to discuss possible stimulus measures to help the global economy, but failed to set any real goals, deciding to hold off until a meeting in April.

Citigroup (C) announced it would cut 52,000 jobs to help lessen the company’s expenses by 20%.

Although retailers Target (TGT) and Lowe’s (LOW) reported better-than-expected earnings, they gave warnings about the current quarter. Target even went so far as to hold off on its plans for a stock buyback and scaled back plans for new store openings.

Tuesday, Nov. 18, 2008

Federal Reserve Chairman Ben Bernanke and Treasury Secretery Henry Paulson were back in front of Congress Tuesday defending the bailout. Paulson said no more money would be spent on toxic assets, which was the original idea through the Troubled Assets Relief Program (aka TARP). He said the next step is to invest a share of the money into a Federal Reserve liquidity facility to improve securitization and help with consumer credit. The Treasury has been buying equity shares in troubled financial institutions instead of purchasing the toxic assets.

The Big Three U.S. automakers were also in Washington Tuesday, begging Congress for their own $25 billion financial bailout to prevent them from collapsing. Little progress seemed to be made, however, due to opposition from Republican lawmakers and the Bush administration.

On the real estate end of things, median home prices fell almost 8% in the third quarter, thanks to all the foreclosures in the market, according to a survey by the National Association of Realtors. A record four out of five U.S. cities saw prices fall.

Hewlett-Packard lightened things up a little, though, announcing it expects to beat analyst estimates for the fourth quarter, in spite of a drop in consumer spending.

The world welcomed its new largest brewer as Leuven, Belgium-based InBev finalized its acquisition of American brewing company AnheuserBusch to become AnheuserBusch Inbev.

Treasury Secretary Paulson stands with Fed Chair Bernanke.

Wednesday, Nov. 19, 2008

Wednesday started with a disappointing report from the Commerce Department that said housing construction starts fell 4.5% in October to 791,000. This is the lowest number the government has ever reported.

According to minutes from the Fed’s meeting back in October, when interest rates were lowered by half a percentage point, it doesn’t expect an economic recovery until halfway through 2009. The minutes also indicated uncertainty over the bailout plan and the related new government authority. “The specifics and effectiveness of some government programs to support financial markets and institutions remained unclear.”

Meanwhile, hearings continued over a possible $25 billion bailout for the auto industry in Washington. Company executives and head of the United Auto Workers Union, Ron Gettelfinger, testified.

When you think of pirates, thoughts of Jack Sparrow or Captain Cook usually come to mind, but you may be surprised to hear that piracy (no, not like Napster in the late nineties) still exists and is a major problem for oil supplies. Over the weekend a Saudi Arabian tanker carrying $100 million worth of oil was hijacked by Somali pirates. It’s bad enough oil prices can be affected by fires, politics, and pipeline explosions, but now we need to worry about pirates holding supplies for ransom? Apparently.

Pirates aside, the Dow had it’s “booty” kicked Wednesday, falling below the 8,000 mark, to the lowest level in the last 5-1/2 years, thanks to falling financial stocks and a poor economic lookout from the fed.

Consumers, on the other hand, had reason to be cheerful for their upcoming holiday shopping, as consumer prices fell 1% in October. This was in part due to drastically falling oil and gasoline prices, which affect prices on almost everything. This was the largest one-month decrease ever seen since this began being measured in February of 1947.

"Big 3" Auto CEOs Testify for bailout money.

Thursday, Nov. 20, 2008

The automakers weren’t able to persuade Congress to help them out right away, as leaders on Capitol Hill delayed a vote on an auto bailout. In spite of bipartisan work to put together a $25 billion plan for the industry using money from the Energy Department, an agreement could not be made.

This news was not taken well by the markets, which plunged by the end of the day. The S&P 500 fell to 752.44. It hasn’t been that low since 1997, 11 years ago.

The S&P 500 wasn’t the only financial number to do time traveling this week, as oil prices fell to levels we haven’t seen since 2005. After hitting an all-time high a few months ago of $147 a barrel, oil fell below $50 Thursday morning. Meanwhile, the average gas price Americans are paying at the pump, according to AAA, is $1.99 a gallon.

Friday, Nov. 21, 2008

President Bush signed into law a bill providing extended jobless benefits Friday morning. This was to help unemployed Americans through the holiday season.

The second-largest U.S. bank, Citigroup, had quite a rough day, falling almost 20% to $3.77 a share. The bank has gotten to the point where it’s considering selling off parts of itself or possibly the whole company. Ironically, this is the same company that battled competitor Well Fargo in court to nab Wachovia’s banking operations about a month ago, but lost.

The Dow crossed back up over the 8,000 mark Friday at close as news broke that Obama will tap Timothy Geithner to take over for Henry Paulson next year as Treasury Secretary. Geithner was heavily involved in putting together the AIG (AIG) rescue. Many consider this post to be one of the most important as we face what many economists say is the worst recession in decades.

Timothy Geithner speaks with Fed Chair Ben Bernanke.