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It is a rare day when the stock market qualifies as Story of the Day without either passing a round-number milestone or suffering a dramatic downturn. After two weeks of volatile trading, Wall Street made headlines because of the extreme measures taken by the Federal Reserve Board to ensure its stability. The central bank made three separate injections of cash to keep the financial system liquid, a total of $38bn. ABC and CBS both led with high finance. NBC returned to that stakeout in the Utah mountains, where there is still no news about those six miners.

Choose your anthropomorphic metaphor for the Fed's cash infusion. ABC's David Muir (subscription required) chose amphetamines: "It was an emergency shot in the arm for Wall Street." CBS' Kelly Wallace offered Alka-Seltzer: "Wall Street woke up with a hangover and got some much needed medicine from the Fed." After yesterday's decline (text link) of 387 points on the Dow Jones Industrial Average, the index declined by a further 200 during the day's trading before the Fed's pick-me-up was announced. When all the dust was settled Wall Street had a positive week. CNBC's Maria Bartiromo told NBC substitute anchor Ann Curry that the cash injection was "an extraordinary move" and CBS' Wallace pointed out that this was the first such intervention since the aftermath of terrorist attacks of September 11th, 2001.

ABC's Muir warned, however, that the problems caused by falling housing prices and mortgage foreclosures may not be over. Those "easy-to-get mortgages" at one point "seemed like a good deal for Main Street and Wall Street--people with poor credit got homes; investors got profits from the interest." Over the next 18 months, a further $600bn in adjustable rate mortgages are scheduled to reset and three million homebuyers face higher monthly housing payments.

Andrew Tyndall 8/13/07 9:22:36 pm

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