Thursday, August 09, 2007

It's official: panic in the markets

I somehow missed this earlier today. When central banks start injecting money into the system, you know it's getting really ugly, really fast.

Will this wall of money do any good? Well, sure, in the short run, although arguibly the signal it sends will work in the opposite direction.

What's really hurting the market is that nobody knows what those securities backed by subprime mortages are worth. If the meltdown continues, I wonder if the Fed will be willing to buy those bonds at a certain price.