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The headlines from Wall Street did not concern plummeting stock prices so much as volatile ones. Even though the Dow Jones Industrial Average fell 387 points in a single day, that drop followed violent upswings on previous days. Today's closing of 13270, despite the downdraft, was still higher than at the start of the week. "The market has shot up or plunged in triple digits 11 out of the last 15 sessions," ABC's John Berman (subscription required) calculated, the most volatile period of trading since the run-up to the invasion of Iraq in 2003.
The latest factor to roil markets was that "the mortgage mess developed a French Connection," as CBS' Kelly Wallace put. Funds run by BNP Paribas, the largest bank in France, announced huge losses from $4bn investments in defaulting American home mortgages. Wallace added that the woes of the housing market are spreading to retailers of home furniture and home improvement supplies, such as Home Depot. NBC substitute anchor Ann Curry asked Mad Money host Jim Cramer from CNBC to suggest a remedy. He argued that the Federal Reserve Board needs to help "homeowners who are walking away from their homes--they cannot afford their mortgages." Declared Cramer: "The Federal Reserve needs to cut." George Bush was asked whether the federal government should intervene. "I am told there is enough liquidity in the system to enable those markets to correct," was how ABC's Berman quoted the President. Berman did not speculate whether Bush meant "correct" by prices moving upwards or downwards.
NBC followed up by sending Josh Mankiewicz to illustrate what the housing market looks like when foreclosures strike. "Red ink gives way to green pools," he reported from Arizona as realtors are forced to show filthy kitchen cabinets and backyard swimming pools growing green slime. "Empty homes bake in the summer sun, their former tenants so broke they could not afford to clean the place before abandoning it to the bank."
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