Stocks Tumble

Watch this space. The New York Times is reporting that spreading credit problems are causing uncertainty in the markets: Stocks Tumble as Home Loan Worries Spread

As usual Bush had nothing useful to say. He didn’t even mention the words “housing” or “mortgage” in his very limited comments at the Treasury Department. That only goes to show just how well he understands the plight of the everyday borrower. The Republicans really have become the party of the big rollers.

I get the feeling that the Bush regime will not get involved as the problem spreads. They have no ideas. The market will deal with this by hammering the little guys. And possibly by dragging the economy down.

The signs are already worse than they were last week when I first wrote about this. Both the Fed and the European Central Bank have had to inject funds into the economy to provide liquidity. That’s not good, if only because it’s a sure sign they are concerned about the broader impact.

And for those of you who are interested in globalization think about this: the Europeans are feeling a credit squeeze based upon the excess in American mortgage and housing markets. That’s a whole lot of annoyed Euro types wanting to trash Californian “mcmansions”!!