S&P to the Rescue!

We started with a meltdown yesterday, but we didn’t finish there. Just when Wall Street was ready to throw in the towel, along came S&P to throw it a rope.

When the day started overseas markets were down about 3%. There were concerns that a falling dollar would depress foreign economies. And a depressed world wouldn’t buy as many US exports. So US markets opened down as well.

But in the middle of this pity party, S&P announced that they could see a light at the end of the sub-prime tunnel. While banks have already charged off about $150 billion S&P said that total losses will eventually be about $285 billion—only $20 billion more than their forecast two months ago. The stock market traded up sharply on the news, finishing higher on the day.

The thing is, neither the S&P nor anybody else really knows how the housing market will do this summer. History would say that it should be fine. But until we get accurate indicators of the housing market’s true health, nobody actually knows. Meanwhile, we wait. And enjoy the ride.


Douglas R. Tengdin, CFA
Chief Investment Officer
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By | 2014-09-03T17:15:30+00:00 March 14th, 2008|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. –
Leave a comment if you have any questions—I read them all!
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