SEATTLE - "You go up on the escalator, but you come down on the elevator", Paul Latta tells me. He's the Research Director at Macadams Ragen Wright in Seattle, giving a pretty good description of the financial markets in the last year and the last two days.
Escalator ride up until about 11:30 Thursday morning and then the elevator ride which, one way or another, we've all been on.
Thursday's nearly 1,000 point drop in the Dow Jones Industrial Average didn't repeat itself Friday, but it was still a pretty crazy day for traders and analysts and anybody with stocks and bonds on their 401k. The Dow finished the day down 140 points - a two day drop of nearly 500.
Latta says the current social turmoil and financial uncertainty in Greece and throughout the European union is "certainly on the list" of likely reasons for the up-and-down-and-down-again ride on Wall Street.
He says we should also consider that the stock market has been very healthy in the last year and a certain amount of selling was expected at some point. Also, most of the quarterly earnings reports are now out and investors have had time to consider them and make buys and sells accordingly.
Uncertainty over Goldman Sachs, BP and the oil spill in the Gulf and financial regulation legislative battles contribute to an overall environment of uncertainty and fear and that is not the kind of environment that promotes a rising tide in the sea of stocks.
And what happens next week? Latta sees wobbly days ahead as well as a return to a more stable footing.
"I do think the market will find itself, find a bottom sometime early next week, but it might start down initially on Monday," said Latta.
To add a comment, please register or login.