March 9, 2001
Intel's Woes Trigger Stock Market Slaughter
Yahoo may have knocked the Nasdaq off its rally yesterday, but Intel's woes have sent the entire market sliding and taken investor confidence down with it. In morning trading, the Nasdaq slid nearly 5% from yesterday's close and has plunged approximately 60% in one year. But hang onto your hat! The roller coaster ride has just begun.
There was a spark of optimism for three whole days this week, but no amount of positive thinking can replace reality. And the reality is the economy is in the midst of a severe economic slowdown, if not a recession. The majority of companies will see sales and earnings plummet. Many companies will lay off workers and reduce spending in order to pare costs. As the downturn drags on, debt-laden corporations will file for bankruptcy.
All of these factors will push the economy into an even deeper recession. Falling earnings will continue to disappoint investors and drag down the stock market -- and the whole vicious economic cycle will continue lower.
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