Spiking Oil Prices Have Market Flat

by Darren

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Oil is getting to be a very expensive commodity. Investors are waiting for earnings reports this week, and are absorbing quite a bit of mixed economic news. America’s largest banks are getting ready to bail out the subprime paper market.

Citigroup Inc., the nation’s biggest financial institution, reported that third-quarter results fell 57 percent because of investments in mortgage-backed securities. The drop wasn’t as severe as the company had warned could occur.

The bank — along with JPMorgan Chase & Co. and Bank of America Corp. — announced the creation of a fund used to help revive the asset-backed commercial paper market.

The fund will buy assets from structured investment vehicles, also known as SIVs, which buy corporate bonds and subprime mortgage debt. The bailout was orchestrated by the Treasury Department to avoid a fire sale in the market.

All in all, this should be a very interesting week on Wall Street as more earnings reports steam in.

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