What's Up On Wall Street - Steven Russolillo, WSJ

Well the stock market -- stock market might have you a little bit depressed but June night is gonna brighten your day. With the market update that's not so hot but she does have news about gas card you're right here give -- away gas card today in Andy's -- Whale watching tickets to giveaway leaders see Lee -- sea fishing yes. Deep digging deep into the prize -- one about these will watch tickets but there 45 dollars a piece of you to take -- family of four that would argue worth 200 dollars so that's you know and it's a fun thing to do with the kids hide -- and entertained and it's out of Plymouth but that's not today today's the gas card gas card. Mean can you tell me win now now. He then -- -- out so I'll I'll I'll try to cheat again I am I am it. All right the Dow is down 36 points S&P 500 is down seven NASDAQ down fifteen. Oil is up nine cents 8332. You've got that ten year US treasury still sitting at one point 51. And goal is sitting at sixteen point slots -- what we're joined by Stephen reversal from the Wall Street Journal Smart money magazine and here's here's what's going on. This week to the Federal Reserve is convening and a lot of investors are hoping that the Fed will come to the rescue. I'm just not sure what the Fed can do Stephen welcome to the show are you doing. Until wolf thank academy guest tonight. I keep reading that everybody's looking for QE3. In that day you know the Fed's -- rescue the stock market but. It's beyond me as to what they might be able to do maybe you can help -- -- that -- You know it. It it's looking beyond a lot of people I think they -- they keeping injuring up. Q victories in big buzzword that a lot of people are talking right now but with interest rates -- released a low. The whole point of the bond buying program too is -- it is too. You know keep lowering interest rate story now really the question is how much lower -- they go and so I think we're at a point right now where he's. In principle while diminishing returns come into effect in each state -- that is -- stepped in and do something. It may not have as big an impact to make an argument that it has an impact on the economy at all it's really only had a big impact on risky assets and on the stock market. But in terms -- -- appointment and -- the general economy it's it's very debatable as to what these programs fed programs that actually done so. As does stock market got a lot weaker here the last few weeks he's seen a lot more calls for the for the that the common and do something do anything to it to -- -- that to stop the sell off here. But the you're right it just is it that there's a lot question mark as to what the does that actually can do at this point one what one would think one would think that they have something and a -- that that. -- maybe double. Surprise people and can at least get some sort of short term -- for the market but you know again it's still very much up in the -- at this point. The the effect of them buying back treasury has been to reduce interest rates but right now there's seems to be. An overwhelming demand for treasurys. Is it possible now that they go out they start buying mortgage backed securities to drive mortgage rates down even lower than where they are now I mean. Many would argue that our mortgage rates are well they are there at all times all righty Paul got. Sued out of bed come out now and and get an even lower in it in order to try to incite people to -- state. It's possible it's actually possible but still it makes you wonder you know these these are all short term fixes at this point he's not long term solutions that. You know the defendant -- such banks around the globe are gonna continue contemplating these these plans -- really. They're not fixing the big truck global problem of massive economies around the world there are slowing it's getting really really nasty Europe. China has now looking good and and the US which several was hoping we could kind of it'll be the best server that bunch is is he's really not looking so hot especially at that really weak jobs report on Friday so. -- -- it's looking it is really our -- -- moved out there in the markets today and that's been like that the last few weeks and. You know there's there's a lot of cap over the next few weeks coming up there's -- big ECB meeting. Bernanke is testifying later this week and so people are gonna look I don't know what it. He's going to say that could hint at additional stimulus but then later this month they have and another that meeting in. -- the end of Operation Twist coming that would be. Doesn't like is the QE2 point five is what people like Colin wasn't exactly QE3 but it was both the Fed's latest. Effort to sort of stimulate economy that's coming to an end and so. There's a lot of moving parts here there's a lot of tension devolved they're going to be taking place over the next few weeks and absurd. The market that's two of big sell off adaptors such the other over the Russian -- and the treasury until the last few weeks. People are hoping or it's some sort of answers. Sooner than later but. There is a war wearing a lot of question marks a period. How big a deal do you think agree collections are. You know it I know it's it's an inconsequential country but. If they exit the eurozone and and that sets the precedent and you could see Portugal do the same thing you could see Spain theoretically the fourth largest economy here. Do this. Exactly exactly CIA agents inconsequential in the sense that it's a pretty small country compared to the rest -- the ramifications of what it does. And what sort of impact it could have on the rest of the year nation the eurozone is is just is huge and so. You know don't -- elections or are definitely going to be very important the next few weeks. But the the real worry right now it's been added there's there's no arguing it and because that's the turnaround and futures overnight today. And the key was that there was some report that they're saying the Spanish government is working on plans to recapitalize. The banks. Propaganda -- very flimsy nothing about nothing sentenced on nothing definite yet so probably people are really looking at Spain because that is. That's the key rate now the obviously a lot of chatter about about Greece and Portugal but. You know it's been rooted in his glory of that certificate even worse it's it's not gonna look good for what else. Well I think the the confusion is Stephen how do today recapitalize the banks the government doesn't have any. You know you it's not like the United States where they can print more year or more -- dollars. And bail out the banks need they don't control their own currency they're using a shared currency so they can't. These have to get the ECB and the Germans in order to it to play ball in order to bail out their banks in the. Well absolutely absolutely and right now the ECB has been very hesitant to to really do anything a lot of people are calling for. From more bond buying and their partner very similar to what extent this has been doing in the they are very hesitant and obviously charming as you mentioned is also extremely has I mean. There are also some reports that there are over over the weekend thinking attorneys and the so signaled that media world where more willing to her. -- support for European banks stay in the key that was and -- double what is being insensitive or urged Germany to step up and LP -- now global but you know they -- the that the best out there that data over what they can really do this and put what is the incentive for them do it and so. You know that's going to be. Obviously a huge huge issue to watch. And US investors are folks knotted that could mean that the FB 500 is now down 10% from its key. In in April and so. Which is just amazing to think about because in the first quarter this year stocks were just. Can we just go straight up than analysts say -- and don't want to miss out on this rally in just as quickly as. That definitely -- over the cultures that is essentially lost all the gains rate so. It it's pretty remarkable how quickly all of this that has turned and the other couples out there would say that. Tickets are just as quickly again because and so beaten down right now that you know any hint of good news could kind of turned things around very quickly put. At this point -- It's. Everything that -- is definitely pretty -- out there. The and the -- New -- factory orders number didn't help -- that. Although all -- heard I think that the stock market was politics when gains the first few minutes of trading and -- the factory orders number came out. Around 10 o'clock. Little bit worse than expected -- about point 6%. The previous outlook also revised lower so again these are just -- just it's just. Yet another indicator that the economy. Is flowing into any sort of momentum that was building in the first quarter of the year has really. Come to a screeching halt at this point in and people are very concerned about what's going to happen next though. Doubt about weak point now it's down 22 points -- There was a turn right around that time that report came out. Are -- -- appreciate your time thank you very much for joining us Stephen. -- Steve universal from the Wall Street Journal joining us today. On the financial exchange and you know it seems like the tenor. Is somewhat negative factory orders were expected to improve -- -- worst and yet they did dropped by -- point 6% in April analysts expecting -- point 2% growth. So that's disappointment tonight.