Bush: Rebates on the Way
04/25/08 - 12:09 PM EDT
Nat Worden
Furthermore, the government has reported the U.S. labor market has shed jobs for three months in a row and prices for fuel, food and other commodities are soaring around the world as the Federal Reserve lowers interest rates to stimulate the economy.
The Fed recently had to rescue the nation's fifth-largest investment bank, Bear Stearns (BSC Quote - Cramer on BSC - Stock Picks), from bankruptcy and oversee its sale to JPMorgan Chase (JPM Quote - Cramer on JPM - Stock Picks). Other major financial institutions like Citigroup (C Quote - Cramer on C - Stock Picks), Merrill Lynch (MER Quote - Cramer on MER - Stock Picks), Lehman Brothers (LEH Quote - Cramer on LEH - Stock Picks) and Bank of America (BAC Quote - Cramer on BAC - Stock Picks) have also seen their stocks plunge amid heavy writedowns on mortgage-related investments. Meanwhile, a report released Friday the National Conference of State Legislatures reveals that financial conditions at state governments have become so dire that they appear to be in a recession. By mid-April, 16 states and Puerto Rico were reporting shortfalls in their current budgets as tax revenue plunges. The situation is even worse for the upcoming fiscal year, with 23 states and Puerto Rico already reporting budget shortfalls totaling $26 billion. More than two-thirds of states said they are concerned about next year's budgets. "Whether or not the national economy is in recession -- a subject of ongoing debate -- is almost beside the point for some states," said the report.
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