Taking Stock

The notional wealth is getting sucked into a political vacuum, with the centerpiece rescue plan of the current administration all but discredited and the policies of next one still a matter of conjecture. There's a financial vacuum out there as well, defined as the difference between the capital the U.S. banks have and what they might need to cover the losses yet to come. According to Friedman Billings Ramsey, those losses could require another $1 trillion or more in common equity -- with Uncle Sam on the hook as the investor of last resort.

In the meantime, Citigroup's decision to stop marking to market $80 billion in dodgy assets has merely amplified doubts about its long-term solvency. The stock is down 17%, which actually represents an improvement from the morning's 25% plunge, but hardly a resounding vote of confidence. JPMorgan is now down a mere 10%, as securities backed by commercial real estate remain under severe pressure, yields on such bonds blowing out to more than 15%, Reuters reports. General Electric, which is not much less leveraged than the official banks, is off 7% in the general hospital's basket-case ward.

At least retailers and techs are enjoying a nice relief rally -- with Wal-Mart up 3%, Target 6% and Amazon 9%. Crude's down to $50 a barrel and the Bush Administration has finally agreed that extending jobless benefits makes sense after all. Try not to spend all of those inducements in one place.