Top 10 News Items 2/17-2/20: Obama Unveils Housing Plan; Financials Continue Getting Smashed; GM Asks for Additional $4.5B

February 20, 2009 4:26 PM EST

Here is a recap of the top news items for the week on Wall Street:

1. President Obama unveiled his housing plan, formally called the Housing Affordability and Stability Plan, on Wednesday of this week. The plan has 3 key components: 1. refinancing for up to 4-5 million responsible homeowners to make their mortgages more affordable, 2. a $75 billion homeowner stability initiative to reach up to 3-4 million at-risk homeowners, and 3. supporting low mortgage rates by strengthening confidence in Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE). Click here to see the full outline of the proposed plan.

2. Financial stocks had one of their worst weeks in a while, falling on continued concerns over Obama's stimulus/housing plan and chatter that nationalizing US banks could be more likely than previously thought. Bank of America (NYSE: BAC), which was the most heavily traded stock on the NYSE this week, ended this week's 4 days of trading down 32%. Elsewhere in the financial sector: Citigroup (NYSE: C) fell 42%, Wells Fargo (NYSE: WFC) tumbled more than 32%, Goldman Sachs (NYSE: GS) was down 13%, JPMorgan (NYSE: JPM) fell 20% and Morgan Stanley (NYSE: MS) was down about 16%. The entire financial sector, as measured by the Financial Select Sector SPDR (NYSE: XLF), fell by more than 16% this week.

3. General Motors (NYSE: GM) submitted its highly-anticipated viability plan to the US Treasury Department on Tuesday of this week. The automaker requested another $4.5 billion, to $22.5 billion. GM said if a new, even lower downside scenario occurs it would need an additional $7.5 billion, or a total of $30 billion by 2011. Click here for the full report. Chrysler also said it will need another $2 billion. Shares of GM finished the week at around $1.87, down about 30% from last Friday's closing price.

4. Wall Street was surprised, once again, with alleged fraud reports. This time the news came out of Stanford Group, where Sir Allen Stanford was charged by SEC for running an $8 billion investment scheme focused on a CD program. Here is StreetInsider.com's full report on the news.

5. Investors are scared, mad and running for gold. Friday, the precious metal topped the $1000 per ounce mark for the first time in nearly a year. Since the credit crisis intensified in late fall, gold has rocketed over 40% from its consolidated price of $700.

6. CNBC contributor Rick Santelli shook up the investment world this week with "The Rant Heard 'Round the World". Santelli questioned Obama's new housing program and even suggested hosting the Chicago Tea Party. The revolutionary cry hit home for many investors watching CNBC and even was commented on by such high-profile figures as the Drudge Report, Rush Limbaugh and even White House Press Secretary Robert Gibbs.

7. PPI ticked higher this month, coming in at up 0.8%, compared to the consensus of up 0.3%. Core PPI rose 0.4%, higher than the Street's consensus of up 0.1%.

8. While the US markets were closed on Monday for President's Day (thanks Abe and George for a day of relaxation) Japan issued its Q4 GDP numbers. The world's second-largest economy shrank an astonishing 3.3% sequentially, or at an annual pace of 12.7%. The news sent markets worldwide plummeting, and when US trading reopened Tuesday, stocks gapped substantially lower.

9. Shares of General Electric (NYSE: GE) tumbled about 18% this week on further concerns related to its Capital arm, credit rating sustainability, the dividend and the broader markets. The stock officially dipped below the $10 level for the first time since 1995.

10. Numerous 13F's were filed this week, including Warren Buffett, Carl Icahn, David Einhorn, John Paulson, Bill Ackman and Nelson Peltz. Click each of the investors names to see a summary of the 13F filings.

Related Categories

Special Reports

Stocks Mentioned

Related Entities

• Carl Icahn
• Warren Buffett
• William Ackman
• Nelson Peltz
• Trian Fund
• Chrysler LLC
• JPMorgan
• Goldman Sachs
• Greenlight Capital
• David Einhorn
• Citi
• Morgan Stanley
• Banc of America
• Paulson & Co. (PCI)
• Stanford
• Dividend
• StreetInsider.com Top 10 News Items for the Week

Add Your Comment

Name

Subject

Body

Verification can't see the text?
click here to refresh the image.
what's this?