No Apocalypse Dow

No Apocalypse Dow

No Apocalypse Dow

A summary of what's in the major U.S. newspapers.
Sept. 2 1998 7:08 AM

No Apocalypse Dow

Yesterday, the collapse of the stock market led all the papers--today it's the market's recovery. All the papers report that yesterday's 288 point Dow upswing erased more than half of Monday's loss, on record volume. And the papers continue to be scrupulous about raw numbers versus percentages--noting that in point terms, yesterday was the second biggest up move ever, but far down the list as a percentage gain.

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The Washington Post says the market's turnaround yesterday could be attributed in part to the suggestion by Abby Joseph Cohen and several other "notable strategists" (the Post's phrase) that investors should increase their stock holdings. The New York Times takes note of Cohen's advisory too, but doesn't attribute any market action to it. On the other hand, the paper dedicates most of a paragraph to passing along Cohen's recommendations of an optimal portfolio mix. The Post emphasizes the human side, with a tale of a broker abruptly coming back in to work from a family vacation, and two stories about brokers making reassuring calls to their moms. And the WP even throws in the information that stock market professionals were dressing differently at the office yesterday, to allow for more running around. Gratifyingly, the Los Angeles Times includes a paragraph in its coverage (albeit after the jump) about how "specialists" were functioning as the buyers of last resort during Monday's drop when no buyers could otherwise be found. Unlike the others, the Wall Street Journal highlights the economy's fundamentals, running a piece noting that the three economic reports released yesterday--the index of leading economic indicators, one on construction spending, and a purchasing index--show a slow-down, but "nowhere near a recession." A second Journal story reports that U.S. new car sales remained robust in August. "Overall it's hard to see global economic collapse in these numbers," one auto analyst is quoted as saying. The WP has a front-page check-in with a number of economists in which most are quoted thinking the stock market's turmoil will not cause a recession.

Russia's situation is on everybody's front. The LAT reports that Boris Yeltsin and acting Prime Minister Viktor Chernomyrdin assured President Clinton in Moscow meetings that they still support democratic and free-market reforms. The NYT and the WP fronts cover Clinton's platitudinous speech to Russian students and young business people about the values and risks of reform. Gone, says the Times, is the backslapping of yore between Yeltsin and Clinton. Their state dinner was over at 9:15 PM.

The WP reports that the Paula Jones trial judge raised the possibility in the footnote of a legal ruling that she might hold Bill Clinton in contempt of court because of apparently misleading answers he gave before her about his relationship with Monica Lewinsky. In the footnote, the judge admits that she has "concerns" about Clinton's testimony given his recent public statements.

Today's Papers experienced its very own market correction yesterday when several readers pointed out (okay, several readers and one boss) that the column was mistaken in saying none of Tuesday's coverage mentioned what role, if any, "circuit breakers" based on excessive market moves have nowadays. But indeed, yesterday's NYT front addresses the issue: they stop trading upon a drop of 900 points.

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In case you worried about how the good people of Greenwich, Connecticut are doing during these days of Apocalypse Dow, an inside NYT piece is here to report that they are soldiering on. In sheer dollars, says the paper, few towns have benefited as much from the Dow. The piece is accompanied by a picture of a local man visiting a car dealer to pick out a Porsche "just for variety" to go with the Porsche he bought just a few months ago.