China Vanke Co., the nation’s biggest publicly traded property developer, lost 4.9 percent and Poly Real Estate Group Co., the second largest, retreated 6.4 percent. China Petroleum & Chemical Corp., the country’s second-biggest oil company, dropped 4.3 percent and China Shenhua Energy Co., the nation’s largest coal producer, fell 4.7 percent on concern a deepening recession will reduce the demand for energy.

The CSI 300 Index, the benchmark gauge of companies traded in Shanghai and Shenzhen, sank 98.59, or 4.9 percent, to 1,918.95 at the close, the biggest drop since Nov. 18. Only 5 stocks rose on the 300-member measure.

Some analysts are guessing that interest rate cuts are merely window dressing, and their very introduction means the economy is already in slow growth. You wouldn’t need to lower interest rates if you had a booming economy, now would you?

The People’s bank of China announced their new lending rate has been lowered 0.27 of a percentage point and is now 5.31 percent.

Other investors wanted an even deeper cut, and they took property investment stocks down with their expectations. Property investment capital is drying up.

Questions are swirling concerning whether the White House will bail out the auto industry. Speculators think the action is inevitable, and that gave a slight boost to auto shares.

Goldman Sachs announced a $2.1 billion loss for the last quarter. It was the first time that Goldman lost money since going public in 1999.

It was the first losing quarter since Goldman went public in 1999 and demonstrates that even some of Wall Street’s most skilled operators have not been able to overcome historically tough markets and sagging economies across the globe.

Goldman sidestepped earlier losses by staying out of the high-risk subprime mortgage market and taking an early bet against the United States housing industry. But it has been unable to avoid taking big markdowns after nearly 30 percent declines across global equity markets in its fiscal fourth quarter, which ended in November.

The crows continue to come home to roost with bad investments hitting global balance sheets daily.

Morgan Stanley will be reporting earnings this week, and nobody expects less than a loss of $400 million for the quarter.

Bad News:

NWA – Northwest Airlines (NYSE: NWA) – has announced the company is cutting 2,500 jobs due to the high costs of transportation fuel.

Steve and Barry’s – Steve and Barry’s has filed for Chapter 11 Bankruptcy protection. The company blamed the poor retail environment for their troubles.

Insider Transactions:

PIR – Pier One’s (NYSE: PIR) – CEO buys 25,000 shares of the company’s stock.

Good News:

Molson Coors Brewing Company (NYSE:TAP) – Coors is doing a great job of marketing their beer, as compared to larger rivals. “When they tried all this other funny stuff, it was just a flop,” said Morningstar analyst Ann Gilpin. “Recently, they’ve kind of gone back to basics,” adding the message is “resonating more with consumers.”

Oil prices are weighing on the general market.

Adding to the sell pressure today for GM is a downgrade by Goldman Sachs (NYSE:GS). Remarkably enough, GM’s new market cap is less than the company’s market cap was in the 1950s, before current CEO Rick Wagonner was born. Not many CEOs can say that, especially employed ones.

Worse yet, GM stock this year is down an abysmal 54%. Few companies around are experiencing the type of disintegration that General Motors is in 2008.

Record oil prices, the credit crunch and fears about the economy aren’t helping matters. There is still a lot of concern that subprime related writedowns at banks and other financial institutions will result in the worst profit decline for companies since 2002.

In wake of the declining markets, Moody’s has hinted at downgrading Morgan Stanley (Symbol: MS) to an A1 rating.

Moody’s senior vice president Peter Nerby said:
“Markets have clearly been challenging, but the firm has also incurred some expensive trading mishaps during the past year.”

Larger lending institutions were down at market close. Bank of America (NYSE:BAC) closed at $24.59; Lehman Bros. (NYSE:LEH) closed at $22.25.

Follieri has been charged with bilking investors out of millions.

Prosecutors allege Mr. Follieri duped several investors, including a California-based investment fund, into giving him millions of dollars for real estate investments. Instead, prosecutors allege Mr. Follieri used the cash to pay for a variety of personal expenses including his condo, $3,000 suits, and orthodontic expenses for his father.

He also allegedly used the money to pay for a $107,000 vacation in the Dominican Republic and dog walking services. Mr. Follieri even allegedly used $30,000 of investor money to fly his doctor to London from New York to treat him for a minor medical treatment, billing the service as a “house call.” He also allegedly set up an offshore company in Panama that siphoned off $3 million.

Who the heck spends $107,000 on a vacation to the Dominican Republic? Apparently someone with lavish tastes and enough bamboozled clients to live the lifestyle of the rich and the famous, at least for a little while.

Apparently Follieri was dumped by Hathaway recently. Follieri has been in the U.S. since 2003.

Ryan, 45, has been released on $75,000 bail and faces 10 years in prison for her role in helping her boyfriend escape.

Inspectors found Israel’s car with a note that read “suicide is painless” last week. Inspectors now believe the suicide is a ruse from a known scammer and that Debra Ryan actually helped Israel escape.

“We’re continuing to work with federal marshals and the U.S. attorney’s office in an effort to locate Sam Israel,” said FBI spokesman.