Nov. 4 Update: 1,800 Banks May Seek Federal FundsAs Americans lined up to vote on Tuesday, the European markets responded to expectations of an election day Wall Street bounce. Dow futures were up 183, about 2 percent, with investors clinging to the positive that the wait will soon be over to see who will become the 44th president of the United States.
On the banking front, there may be as many as 1,800 publicly-held financial institutions applying for their piece of the federal bailout of banks, say sources close to the U.S. Treasury program that has already doled out $125 billion in investments to the top nine banks in the country. Another 16 regional banks have applied for $33 billion of the fed's money.
Depending on the conditions being drafted by the Treasury, many more banks -- possibly thousands of private banks -- would be able to apply for government investment. A Treasury spokesperson told a news organization that both publicly-traded and privately-held banks and thrifts overseen by federal regulators were eligible for help.
Interbank lending rates in Europe continue a downward slide, as an expected interest rate cut on Thursday from the European Central Bank and the Bank of England will follow the U.S. cutting its prime lending rate last week to 1 percent.
More bad news from automakers came on Monday, as General Motors' October U.S. sales plummeted 45 percent and Ford's dropped 30 percent. Low consumer confidence and tight credit are faulted with spooking consumers away from showrooms. These drops came with Toyota, Honda and Nissan's drops of at least 23 percent. If GM's sales were adjusted for population growth, October is the worst month of the post-World War II era.
On the manufacturing front the news isn't much better, with mounting job losses, manufacturer face business sinking to a 26-year low in October. This news, along with the dramatic drop in auto sales, shows more proof the U.S. has entered a recession. A report from the Institute for Supply Management shows its manufacturing index fell to 38.9. This is the lowest number since the fall of 1982, which was at the end of a 16-month recession.