S&p 500 index records worst September since ’02
September was the worst month for the Standard & Poor’s 500 index since 2002. From AIG to Lehman Brothers to Washington Mutual, a litany of corporate failures and bailouts helped drag the index down 9.1 percent, its worst monthly showing since September of that year, when it lost 11 percent. Still, the index ended down 8.9 percent for the third quarter. That’s not even the worst decline of the year. It lost 9.9 percent in the first quarter.
Philippines a harbor.
Overseas markets offered little protection from the maelstrom that thrashed U.S. stocks in the third quarter. The MSCI Emerging Market index fell 27.6 percent, its worst quarterly showing ever, according to Merrill Lynch strategist Michael Hartnett.
Russia’s market lost nearly half its value over the quarter, slammed by weakening oil prices and military tensions surrounding Georgia. In fact, only one market out of 52 tracked by Standard & Poor’s was able to eke out a gain: the Philippines, which was just barely in the black with a rise of 0.04 percent.
Capitol “F.”
Wall Street was fixated on Capitol Hill last week, tracking the prospects for a bailout plan to cleanse banks’ balance sheets of troubled mortgage-backed securities.
As the House and Senate debated its merits, the Center for Economic and Entrepreneurial Literacy tallied up congressional members with backgrounds in economics. It found only 15 percent with degrees in the business, economics or finance fields.
“Financial literacy is woefully inadequate in this country, and we have been advocating for increased education in economics and personal finance in American public schools,” says James Bowers, the group’s managing director. “But after watching the events of this week, a crash course on Capitol Hill might not be a bad place to start.”
Bond bombshell.
During September alone, Standard & Poor’s recorded nine corporate bond defaults, including ones by Lehman Brothers, Washington Mutual and their subsidiaries. That’s more than half as many as 2007’s full-year total of 16.
The defaults spanned many industries, affecting such companies as Motor Coach Industries International, a maker of luxury and commuter buses, and HRP Myrtle Beach Holdings, which opened a Hard Rock themed amusement park in South Carolina.
The Associated Press
