Financial Markets Tumble Amid Credit Crunch
H: NPR's Jim Zarroli reports.
JIM ZARROLI: Mike Englund is chief economist at the research firm Action Economics.
ZARROLI: Overnight, we found banks in Europe, and in France in particular, had liquidity issues, which raised the question: Are the problems we're facing here in the U.S. rippling through across to overseas? And, of course, those liquidity problems are intertwined with our own since our banks operate in Europe and the European banks operate here.
ZARROLI: Tim Alward is president and CEO of Ford Equity Research.
ZARROLI: There was the first one. You know, this bank in Paris is the second one. And now the fear is, okay, it's spread overseas, there's holders overseas. How big is this?
ZARROLI: Stock prices began to slide, and by the end of the day, the Dow Jones Industrial Average had lost 387 points. The nervousness in the markets this week has been aggravated by rumors about mortgage losses. Goldman Sachs has repeatedly denied rumors about its hedge funds. Yesterday, Goldman declined to comment on reports that one fund was being forced to sell off assets because of heavy losses. Mike Englund says that's how the market has been lately.
ZARROLI: I think confused might be the best approach, you know? Essentially, there's a lot of news rocketing through the market each day, but there's little raw information in the news. You know, it seems every three or four days, we take a new run at prices with some new rumor of a hedge fund that's going under, of a bank that might be having problems.
ZARROLI: Jim Zarroli, NPR News, New York.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.