I am out of the pocket most of today, but I had to address what I see as a misread of the reaction to the latest Bailout plan.
Both the NYT and the WSJ seemed to focus on the lack of details as the cause for the selloff. But that conclusion is belied by the “sell the news” reaction immediately as Geithner began speaking. No one could have digested anything iin that milli-second.
I have a decidely different take. Wall street was hoping for another multi-billion, no strings attached, taxpayer funded giveaway. Instead, they got something much tougher than they expected.
Hence, the selloff/tantrum.
They wanted their candy and didn’t get it…
Markets not gaining confidence from policymakers
Chart via Merrill Lynch