Depression Watch

Dow Close 8,695.79 -443.48

In this devastating market, "risk tolerance" is an oxymoron. It's clear now that many investors can't stomach 30%-40% declines in their fortunes, despite believing they had a high tolerance for the market's worst. --- Of course, no one knows if this really is the worst. That's why mutual-fund investors pulled record amounts of money out of stocks in October and kept heading for the exits in the first week of November. That's understandable, with the Dow Jones Industrial Average down almost 35% so far this year and close to retesting its October lows.  - MarketWatch

The European Central Bank lowers interest rates to 3.25% in an attempt to prevent a eurozone-wide recession. - BBC

Shares of Ambac Financial Group Inc. lost more than a fifth of their market value Thursday, amid concern about the bond insurer's capital position. The company on Wednesday reported a wider third-quarter loss and its debt rating was downgraded to junk by Moody's Investors Services. --- Ambac shares dropped 48 cents, or 24 percent, to $1.52. A year ago, shares traded at a 52-week high of $34.42. - Forbes

The shock vote brought interest rates down to 3pc for the first time since January 1955, when Winston Churchill was prime minister. Economists forecast that the cut could pave the way for further reductions – with some claiming that rates could hit a historic low of 1pc. --- Thursday's move was interpreted as a desperate attempt to protect the UK economy from a severe recession.  - London Telegraph

Forget JFK, Obama could be the next Jimmy Carter --- Barack Obama and his supporters have been drinking from a bottle of elixir labelled Hope. But the President-Elect knows as well as everyone else that there are gallons of bitter medicine to be swallowed if the economy is to be saved. --- he could create so much resentment that he will be booted out of the White House after just one term. Obama's supporters may imagine their man to be the next Roosevelt or Kennedy. But instead of BHO to follow FDR and JFK, he could end up being the next Jimmy Carter.  - London Telegraph

For those who don't know;

Ambac insures bonds from municipal to federal.

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