Updated from 11:56 a.m. EDTStocks in New York continued to stumble Wednesday, as traders took in a broad array of gloomy economic data and assessed a heap of earnings statements, including results from banking titan JPMorgan Chase ( JPM) and comments from Federal Reserve Chairman Ben Bernanke. The Dow Jones Industrial Average was losing 412 points to 8898, and the S&P 500 was lower by 51 points at 946. The Nasdaq stumbled 77 points to 1701. On Tuesday, stocks finished with modest losses, as traders digested the Treasury Department's plan to take a $250 billion equity stake in U.S. banks. The government investment is part of the larger $700 billion Troubled Asset Relief Program to provide assistance to struggling financial firms. Ahead of Wednesday's trading, the Federal Reserve said that Pimco, a unit of Allianz ( AZ), would be the custodian of the government's Commercial Paper Funding Facility, which will buy three-month commercial paper to support money markets. Fed Chairman Ben Bernanke addressed the financial crisis in a speech before the Economic Club of New York Wednesday afternoon. "A loss of confidence by investors and the public in the strength of key financial institutions and markets" lies at the heart of the problem, he said, and that's why the government chose to act preemptively and intervened before the problem deepened. "The crisis will end when comprehensive responses by political and financial leaders restore that trust, bringing investors back into the market and allowing the normal business of extending credit to households and firms to resume," Bernanke said. "I am not suggesting the way forward will be easy, but I strongly believe that we now have the tools we need to respond with the necessary force to these challenges. Although much work remains and more difficulties surely lie ahead, I remain confident that the American economy, with its great intrinsic vitality and aided by the measures now available, will emerge from this period with renewed vigor." Credit markets continued to loosen as central banks across the globe flooded the markets with liquidity. Three-month dollar Libor, a measure of the rate banks charge one another for large loans, declined 9 basis points to 4.55%, its third straight decline. The money markets will look a lot more reassuring when net issuance of commercial paper recovers without the aid of the Federal Reserve, said Brian Bethune, director of financial economics Global Insight Economics. He said that he'd like to see Libor spreads come down another 150 basis points to the 3% range. "It's moving in the right direction," he said. "I think it's only been in the past six weeks that the Fed and Treasury have really realized that this thing is a massive shock," said Bethune. "Once you get six months behind a crisis of this order of magnitude, you're in deep trouble," he said.