An early rally in stocks that pushed the Dow up by 215 points soon after the open, fell apart by noon. Forty-five minutes later, the Dow was suddenly down as many as 150 points. But the situation reversed again, largely on news that the United Kingdom's securities regulator said it would ban short-selling of all financial stocks until Jan. 19.
Then, a huge rally erupted in American stocks this afternoon on reports that the Treasury Department was working on a plan to take bad assets off the books of financial institutions.
News of the plan was first reported by CNBC around 3 p.m., and stocks immediately shot higher. A At the close, the Dow Jones industrials were up 410 points, or 3.9%, to 11,020. The Standard & Poor's 500 Index was up 50 points, or 4.3%, to 1,206, and the Nasdaq Composite Index was up 100 points, or 4.8%, to 2,199.
The idea, as reported by CNBC, would involve creating a federally-chartered company that would take over the bad assets of banks, investment banks and others. The financial institutions would then be able to raise new capital and lend money and finance new ventures.
It's been that crazy.
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