This About Sums It Up

"What is going on with the market?"

Which market? Housing? Stocks? Bonds? Why are things going south, and why does it seem like nothing is helping? It all seems to be unraveling.

MSNMoney has a good summary:

Why Wall Street rescues are failing

The financial system has become dependent on debt and the transfer of risk via convoluted debt instruments, creating a mess that will require hundreds of billions of dollars and global cooperation to fix.

By Jon Markman

Since the wheels started coming off the stock market last summer, investors have looked to at least seven white knights to end the distress with a bold stroke.

Yet each, including Federal Reserve Chairman Ben Bernanke and U.S. superinvestor Warren Buffett, has failed to lift investors' spirits for more than a couple of weeks, ultimately leaving stocks to tumble ever lower. Why?

The fundamental problem in the world economy is that it grew over the past two decades to be incredibly reliant on optimistic risk takers' willingness to accept increasingly complex IOUs from companies, banks and government institutions as investments instead of real assets. Now we are seeing the same movie play back in reverse, as massive investor losses in debts once believed to be safe have led to falling confidence, rising pessimism and extreme risk avoidance.

...

Where will that money come from? The answer is nowhere, at least not very quickly. And that is why the markets are in danger of asphyxiation. It's also why the economy is threatened: For despite the lower cost of money, it's hard for businesses to get loans for expansion because banks need to keep as many dollars as possible on their balance sheets to meet reserve requirements.

Notice there is not too much housing talk in the article. Alittle lead up with the subprime mess. But he left out the impending Alt-A and other possible problems. Only time will tell.