Stocks Plummet

The major indexes all finished down by more than 4% today after the Treasury Secretary announced the Obama administration’s plan for a new bank rescue. The plan which features four main points on attacking the banking issue disappointed investors and is the cause for the steep drop in stocks today. The financial sector took a heavy hit today, down almost 6% as investors thought the plan was not enough to help the ailing bank stocks. The Dow is finished the day below the 8000 level, closing at it’s lowest point since November of last year. The main problem investors seemed to have with this plan was the lack of detail. The plan was a very rough outline of what the administration would do to rescue bank stocks and in this outline no new or ground breaking strategies were reported. Also announced today were more job cuts, this time from General Motors and Walmart. Job loss and subsequent creation is a main focus of the bailout plan which should soon be approved and sent to President Obama’s for approval. Tomorrow should be an interesting day for the markets as we wait and see if investors continue to sell after the rescue plan or use this as an opportunity to scoop up shares of cheap but fundamentally sound stocks.