Sensible Investing

Recap of Recent Events

March 5, 2009

Here’s a summary of recent market news:

- Markets extended their slide with S&P 500 dropping to 1996 levels on the news of stunning $62 billion loss from AIG from derivative gambling. Today’s news of possible GM bankruptcy didn’t help either.

- Warren Buffett’s Berkshire Hathaway had the worst year it its existence.  In the annual report, Buffett said that the economy will be in “shambles” for the rest of the year.  He added, however, that this doesn’t automatically translate to poor market performance and predicted that “the best days for U.S. lie ahead”.

- Real estate market is not getting any better.  One out of 5 mortgages are now underwater, and one out of 8 borrowers is at least one month behind in payments.  These are very high numbers.

- There were a few positive reports as well.  Retail sales rose in February, lead by Wal-Mart, which raised its dividend.  Unemployment claims dropped, and manufacturing report was better than expected.

- President Obama called stocks “potentially good deal” and likened daily market gyrations to noise.

Entry Filed under: Market Conditions. .