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The Dow's Whiplash

That cheering sound you may have heard in the distance right now, regardless of where you're sitting, was emanating from the trading floor of the New York Stock Exchange, where the Dow -- after shedding hundreds of points at opening and falling below 8,000 points -- crossed into positive territory.

What a ride. It would be fun to watch, if it wasn't your actual retirement and savings dollars. If you could see your 401(k) in real time, it would look like an accordion.

What's happening?

A lot of brokerage firms have computerized systems that automatically begin purchasing stock indices, such as the Standard and Poor's 500, once stocks begin to fall dramatically. So the bounce back from below 8,000 to the Dow's loss now at about 90 points, may have a lot to do with those automated triggers.

Also, analysts are pointing out that, despite the bad opening, the stock price of the big financial institutions did not drop along with with everything else. In fact, they were still in positive territory earlier this morning. And the financials often are a leading-edge indicator.

Are the markets pushing off the bottom of the pool, headed back to the surface?

Even the CNBC personalities can't agree -- they're bickering on-air.

-- Frank Ahrens

By Frank Ahrens  |  October 10, 2008; 10:20 AM ET
Categories:  The Ticker  
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Comments

Bickering on air? It's like an old girlfriend. She loved to start a fight because making was so much fun. Have fun and keep us Posted. Watch out for falling junk and stuff. There's work to do and time to do the work. We thought we were running out of time and we were running out of money. It looks like we're into the timeless here. Honey, turn off the TV.

Posted by: IV | October 10, 1908 10:38 AM | Report abuse

Good news is oil is looking lower and security is looking higher. You are going to see oil slicks and more panic. The Post seems to be holding on, so keep holding. Oil going down can only help profits go up. Up is better and down is worse. Stay up Post. They said it would be a rough ride, they just didn't say how rough it would be. Now we know or we think we know.

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Posted by: IV | October 10, 1908 11:01 AM | Report abuse

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