Stock Market Information

Well it looks like Uncle Sam is pulling out all the stops in their efforts to revive the economy and bring a number of financial institutions back from the brink of bankruptcy. The markets for their part, shot up today, which thus far has clocked a gain of more than 785 points over the last two days.

The government announced that they would be placing a ban on short selling over 800 financial stocks until the situation was normalized. This has prompted a number of investors and institutions to cover their shorts, so there’s been huge gains in financials like Bank of America, which is up over 20% so far today.

In addition, the Federal Reserve announced that they would be creating a new agency to handle the bad debts currently on the books of financial banks and other firms across the nation. The cost was staggering, estimated in hundreds of billions of dollars. All told, the government could end up spending over a trillion dollars for the bail out, including those it has already aided like AIG and Freddie Mac and Fannie Mae. In the interim though, the markets are pleased.

In addition the Federal Reserve also said it would expand its emergency lending to let commercial banks finance purchased of asset backed paper with money market funds. The Fed will also be purchasing short term obligations issued by Fannie Mae, Freddie Mac, and also Federal Home Loan Banks.