I thought this stimulus was going to save the country.... so why are stocks still going down?
Dow nears 10-year low - International Herald Tribune
While some people seemed to believe that, Obama never said it would. At first he said that if it didn't pass, we would suffer a catastrophe, but he was careful never to say that if we did pass it, there wouldn't be a catastrophe. At his press conference, he said the stimulus package would slow down the rate of job loss, but he acknowledged that it was necessary to fix the credit crisis to turn the economy around.
The reason the stock market is still in decline is that investors don't have confidence in what Geithner has revealed about what will be done about the credit crisis. When he testified before Congress, members of both parties expressed concern about the lack of specifics in the plan, and both the Wall Street Journal and the New York Times made that same complaint. If you followed the news from Rome, finance ministers from the G-7 states also expressed disappointment with the lack of details in Geithner's plan, which must be considered Obama's plan.
This is particularly troubling since the key issue in solving the credit crisis is what to do with the so called "toxic assets" and the solution Geithner proposed is that the government will motivate investors, by some unspecified methods, to buy them, but his speeches so far have seemed to have just the opposite effect on investor confidence, and investors have increased the rate in which they are transferring their money into commodities and Treasuries.
To be fair, Giethner/Obama don't have much choice in what they do. Dodd and Frank, the respective chairmen of the Senate and House financial services committees, have unequivocally stated they will not approve more money to rescue the financial system, so the administration has to rely for the time being on half measures that have so far disappointed nearly everyone and driven investor confidence lower.
