Thanks a lot, stock markets. Intel editors were allowed to recognize Columbus Day and finally lift our hunched backs away from our laptops for one afternoon, and that was the exact moment that the Dow decided to stage its largest single-day bounce in history. We are never going to get any time off ever again. By now you all know what happened: Hank Paulson announced that he was going to use $250 billion from the $700 billion rescue package to buy stocks in major banks, giving the market a hot cash injection. European banks rallied to make a similar move, totaling $2 trillion in new cash for banks. Japan’s Nikkei staged a 13 percent recovery and Morgan Stanley raised $9 billion by selling preferred shares to Japanese bank Mitsubishi. The FDIC also will insure more loans between banks.
And now here we are, at today, the scariest place to be. Stock futures are looking great for another strong day. Bush, who lately has been spouting more meaningless platitudes on morning television than Kathie Lee Gifford, spoke already in the Rose Garden assuring squeamish banks that the government equity stakes in their operations were “short-term measures.” He also said that the government’s “special-purpose vehicle” to buy up commercial paper would be “a last resort.” And then he totally fled the scene before anybody could ask any questions, as usual, and the camera followed him as he sprinted back into the Oval Office.
The moral of this story? Well, nobody knows what will happen, and what rescue measures will resonate with spooked investors. There could be a run at any time. But! There is a definite bright side that will not change. We know many of you couples out there have been flailing around trying to find the perfect topical Halloween costume. Instead of having to choose between being something boring involving a suit, like Freddie Mac and Fannie Mae, Wachovia and Wells Fargo, Lehman and Bear Stearns, or Andrea Mitchell and Alan Greenspan, now you have a new animal-costume option. You could be a bear or a bull. We anticipate this will be especially exciting for the gays.