Wow, it looks like the stock market went a lot lower today. Perhaps you feel the need to read news reports that claim to tell you "why." But, since they all say the same thing, please allow me to save you the time. I'll keep it to a sentence:
Treasury Secretary Tim Geithner's comments made stocks go down.
Not enough, you say? All right, here are some direct quotes:
"THANKS, TIM" (with chart of Dow prices going lower)
– Drudge Report
"The stock market dipped almost as soon as Mr. Geithner began speaking, with the Dow Jones industrial average down about 350 points, or more than 4 percent, at 1:30 p.m."
– The New York Times
"Stocks Tumble as Bailout Plan Is Unveiled -- The Dow Jones Industrial Average was down more than 300 points after Treasury Secretary Tim Geithner revealed details of the bank-bailout plan. Earlier, the blue-chip index was down less than 100 points."
– CNBC
"The equities market is reacting to the Obama administration's latest attempt to stabilize the economy largely as it did the last eight times the government unveiled steps to curb the crisis, beginning in October 2007."
– Market Watch
"Investors snapped up stocks last week in anticipation of the plan's unveiling, snapping a four-week losing spell for the markets. But investors were quick to unload their shares after Mr. Geithner, in a late morning speech, outlined a plan to stabilize financial markets but didn't provide the sort of specific details that many investors hoped they would hear."
– The Wall Street Journal
See? Each one has its own twist, of course -- including the assertion that Geithner trashed the Dow simply by talking. Yet the premise is the same in each case. So, I'm left with just one question: Is it TRUE? Did his comments really make stocks go down?
I believe I can answer that (so can anyone whose I.Q. matches that of a single-cell organism). Just bear with me on a couple of details -- not because the devil is in them, but because it takes a brief timeline to show how stupid it is to suppose that Tim Geithner made stocks go down.
Geithner began his remarks at 11:11am Eastern and finished 19 minutes later, at 11:30. At the moment he began talking the Dow Industrials were already down 207 points. As for the 19 minutes in question, prices fluctuated up and down within about a 50-point range. When he finished, the Dow was down some 215 points. When the session closed at 4:00pm the Dow ended 382 points lower. Which is to say: the market fell further BEFORE Geithner spoke than it did AFTER.
You be the judge.
Finding after-the-fact "reasons" for what happens should be easy, but even then you can't often trust conventional sources -- especially when they all agree.
Think for yourself. It makes a difference. And speaking of independent thinking, reading some Elliott Wave analysis "for yourself" is also an option:
Click here to learn more.