Dow, Nasdaq and S&P all continue their downward plunge, the Dow was briefly down 200 points, are we headed for another 400 point plunge as the afternoon wears on.
Read more about the causes of the plunge here:
http://biz.yahoo.com/ap/070313/wall_street.html?.v=25
The causes of this plunge while more legitimate in my mind than a few weeks ago are again in my mind overblown. Sub prime lending is a very, very small portion of lending and I don't believe it reflects the overall health of the market.
What should you do? Look closely at your financial stocks and determine their exposure to the subprime market. Stocks like Washington Mutual with a heavy subprime exposure for a big bank will likely have a tough time the next few months while stocks like Bank of America and Citigroup which are getting beat-up although they have minimal exposure are probably bargains at their current levels.
Like I say, get your financial house in order, eliminate your debts and make sure you have a cushion to pay your responsibilities. I do believe we are seeing some signs of the early stages of a recession.
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